Financial Daily from THE HINDU group of publications
Wednesday, Jun 15, 2005
Corporate - Mergers & Acquisitions
SWC acquisition complete, more brand buys on the cards: Mallya
Mr Vijay Mallya, Chairman, UB group, handing over a cheque of Rs 312 crore to Mr Prakash Nane, Director, Jumbo World Holding, at a press conference in Mumbai on Tuesday. Shashi Ashiwal
Mumbai , June 14
A LITTLE less than three months after the Shaw Wallace and Co (SWC) acquisition, the UB group Chairman, Mr Vijay Mallya, has indicated that he still has an appetite for more acquisitions - even as the group has completed its acquisition of SWC and reconstituted its board with Mr Mallya as Chairman.
With an eye on the acquisition overtures being made by global spirits company, Pernod Ricard, for Allied Domecq, he said that Allied may want to sell some of its brands and UB would target these brands.
And it is not just West - UB would look East too for acquisition opportunities in markets such as Hong Kong, he said.
Speaking to newspersons after the board meetings of SWC and its associates and subsidiaries, he said that the previous directors on the board of SWC had resigned.
The board had been reconstituted with Mr Mallya as Chairman and Mr S.D. Lalla as Managing Director.
Other members on the board are Mr S.R. Gupte (Executive Vice-Chairman, UB group), Mr Ravi Nedungadi (President & CFO of the group), Mr C.L. Jain, Mr Shrikant Ruparel, and Mr Mani Narayanaswamy.
The task in front of UB over the next 30-45 days would be coming up with an integration plan from both sides on the way forward.
Subsequently, over the next two months, an integration plan leading to the formation of United Spirits Ltd would be in place; the legal process for this had already commenced. Mr Mallya expects the merger to be completed by the end of this year.
He stressed that the integration process would be "fair and equitable" and that all SWC employees will be given a fair opportunity. Meanwhile, he said that the consolidated sales in 2005-06 would be about 60 million cases, which when quantified in retail price terms is about Rs 14,000 crore.
United Spirits Ltd will combine SWC, McDowell, Herbertsons, and Triumph Distillers.
He said that they would possibly look to get a strategic investor on board the merged entity. UB has already been approached by strategic companies and financial institutions for this purpose, he added.
The consolidated business now has a total of 140 brands, of which 12 are millionaire brands. "There will be a rationalisation here too," he added.
The UB group has paid a total of Rs 1,545 crore for the acquisition, which includes Rs 312 crore for 25 per cent shares acquired through the open offer.
The company now holds 75 per in SWC, 50 per cent through the acquisition and 25 per cent through the open offer, a UB official said.
Responding to reports on the company acquiring more Airbus planes for Kingfisher Airlines, Mr Mallya said that he was signing the deal tomorrow and would reveal the details subsequently.
Stories in this Section
The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription
Group Sites: The Hindu | Business Line | The Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |
Copyright © 2005, The
Hindu Business Line. Republication or redissemination of the contents of
this screen are expressly prohibited without the written consent of
The Hindu Business Line