Mallya says cheers to Heineken beer

Dutch brewing giant Heineken appears to have committed bringing its namesake beer, arguably the world’s tallest beer brand, into India through Vijay Mallya-led United Breweries (UB), as both the players completed “cordial first round of discussions” on their future business ties.

Heineken is set to inherit Scottish & Newcastle (S&N)’s 37.5% stake in UB following a joint acquisition with Carlsberg globally. Mr Mallya, on his part, may allow more room for Heineken in operational management than what S&N had in India’s largest brewer UB. However, the exact contours of the new business relationship will be clearer after subsequent round of talks.

Sources said Dutch brewer’s move to bring in the mainstay Heineken through UB fold was a clear indication that the latter was its preferred partner in the rapidly-expanding domestic beer market. Heineken’s Singapore-based arm Asia-Pacific Breweries (APB) was seen as the vehicle to uncork brand Heineken in India till now.

Read more in The Economic Times article.

Mallya wants to buy Heineken's 37.5% stake in UB

Liquor tycoon Vijay Mallya is open to buying back Heineken’s 37.5% stake in United Breweries (UB), in which he holds an equal stake, at the prevailing market price. But Heineken sources said the Dutch brewer has no plan to sell its stake.

Heineken will inherit stake in UB from Scottish & Newcastle (S&N) after the completion of a worldwide takeover of the British brewer.At the current price, UB’s market cap is pegged at Rs 3,800 crore, down almost 50% from January’s peak. Mr Mallya will have to show up with Rs 1,425 crore if he were to buy back at the prevailing rate.

Read more in The Economic Times Article.

SABMiller eyes UB ally S&N

In a move that could change the sweepstakes in the Indian beer market, brewing giant SABMiller is planning to acquire rival Scottish & Newcastle in a $12.8 billion deal, the Sunday Express said on Sunday.

Scottish & Newcastle is a partner of Vijay Mallya’s United Breweries Group in India. The two have formed an equal joint venture, McDowell Alcobev Pvt Ltd, which has in its stable brands like Sand Piper Lager, Zingaro Strong Beer and Kalyani Black Label Strong.

UB Group CFO Ravi Nedungadi said he expected more companies to join the race for Scottish & Newcastle as SABMiller could face regulatory hurdles.

In the last few years, SABMiller has emerged the main challenger to the UB Group’s dominance of the Indian beer market by effecting a series of high-profile acquisitions. After acquiring the brewery business of Shaw Wallace & Co from the Chhabria family, it acquired Foster’s business and brand in India for a consideration of $120 million.