Anil boarding Air Deccan?

On Thursday, the Street was abuzz with a strong rumour that the pioneer of low-cost aviation could be within striking distance of a deal with Reliance’s Anil Dhirubhai Ambani Group (ADAG). Industry sources in the know of Gopinath’s talks with various investors said a final word is still some time away.

Gopinath is in the process of raising $75-100 million for the expansion of his business. He has revealed he could dilute between 15 and 26% stake of his airline to a suitable professional (not strategic) investor.An analyst said the rumour was sparked by Capt Gopinath’s Mumbai visit, from moving on to London.

Meanwhile, analysts are putting one and one together and speculating that Capt Gopinath could well be opening talks with Kingfisher Airline chairman Vijay Mallya, who, on Wednesday, sealed an acquisition deal with Scottish whisky maker Whyte & Mackay.

Industry sources ruled it out saying “It is not in that connection.” Gopinath has publicly spurned Mallya’s interest in his carrier, saying Mallya should mind his own business.

Read more in DNA Money article.

Vijay Mallya downs Whyte & Mackay

Liquor baron Vijay Mallya today put the cork on months of speculation by announcing the purchase of Glasgow-based Scotch whisky distiller Whyte & Mackay for £595 million (Rs 4,784 crore).

Mallya’s United Spirits, India’s largest liquor firm and the flagship of his UB Group, will now own all the shares held by W&M Chairman Vivian Immerman and other investors.

That will give the Indian company an annual output of 75 million cases, and it will remain the third largest in the world in terms of number of cases produced, behind Diageo and Pernod-Ricard SA.

Mallya, chairman, UB Group, said at a video conference from Glasgow that the 140 brands owned by the company, including Whyte & Mackay, Isle of Jura, The Dalmore and Vladivar vodka, had been independently valued at £170-190 million.

The distiller’s brands will be sold in India, China and Russia. Besides, the firm’s Scotch will be used to blend whisky in India.

The deal is estimated at 21 times historical EBITDA (earnings before interest, tax and depreciation) for the year ended September 2006, a premium to those of peers Diageo and Pernod-Ricard.

Analysts, however, believe the premium is justified and inevitable, given the growing demand for Scotch whisky worldwide and the fact that not too many distillers are up for sale.

The combined turnover of United Spirits and Whyte & Mackay in the current year may touch Rs 4,700 crore and the combined operating profit, Rs 750 crore.

The deal will be financed through a combination of borrowings from Citibank (£310 million) and ICICI Bank (£ 325 million). A part of this debt, £325 million, is to be raised in Whyte & Mackay without recourse to United Spirits.

Read more in The Business Standard article.

W&M tells Mallya to pay $1.3 bn

UB Group, the world’s third-largest spirits maker, has been asked to pay £700 million ($1.38 billion) for Scotland’s Whyte & Mackay, the Indian distiller’s owner, Vijay Mallya, said today.

Bangalore-based UB will decide how much it’s willing to pay within two weeks, he said. In March, UB Chief Financial Officer Ravi Nedungadi said United Spirits Ltd, a unit of the Indian distiller, would buy Glasgow-based Whyte & Mackay, owned by Chairman Vivian Immerman and his brother-in-law Robert Tchenguiz. While Nedungadi didn’t disclose the price, media reports of a £550 million acquisition were not “off the mark,’’ he said.

Mallya, who runs a low-cost airline named after his biggest selling beer brand Kingfisher, is adding international brands and a global sales network to compete with rivals such as Seagram Co and Bacardi Ltd. The acquisition would extend a record year for takeovers involving Indian companies

Read more in The Business Standard article