The Hindu Business Line : 17 UB beer brands to tickle TN -- Empee says no to buyout offer

Mr Philip Sargunar, Executive Director, Empee Distilleries Ltd, said the move would stem from his company's just concluded brewing and distribution pact with the UB Group entities — UB Beer Ltd and Millennium Alcobev Ltd. A total sell-out by Empee's promoter-owner, Mr M.P. Purushothaman, was not on the agenda at the moment, he added.

Mr Sargunar said Empee's decision to join hands with UB would energise the Tamil Nadu beer market. "This will see the influx of fresh brands and many varieties,'' he said.

UB is expected to introduce its own as well as acquired brands in Tamil Nadu, the third largest beer market. The brands of Scottish & Newcastle (S&N), with which UB is poised for a joint venture, will also be brewed in the State.

Empee has forwarded the list of 17 brands to TASMAC, which is the Government body overseeing the alcoholic beverage trade in the State. The brands in the reckoning include London Pilsner, UB Ice Beer, Zingaro, Sandpiper, Kingfisher Strong, apart from UB's flagship Kingfisher Premium Lager.

Meanwhile, UB's traditional ally Balaji Group's half-a-million hectolitre brewery is likely to begin functioning in the next few months, providing the domestic major with a stranglehold over the Tamil Nadu beer market.

What may have prompted UB, which does not own a brewery in the State to look at Empee is the likelihood of TASMAC imposing a ban on import of beer from other markets.

TASMAC has alleged that some of the alcoholic beverage labels registered with it have misused the licence through spurious and smuggled imports in the past. In fact, the Government body may impose a ban on Indian Made Foreign Liquor (IMFL) imports from April 1 onwards. A similar move is anticipated in the case of beer once Balaji brewery becomes operational and Empee completes its capacity expansion.

Tamil Nadu will have a cumulative capacity of 15 lakh cases per month when its three breweries — the third being Mohan Breweries — run to full capacity. This will be more than enough to take care of the Tamil Nadu beer market's growth potential in the foreseeable future.

Mr Sargunar said global brewers, including the South African Breweries, had approached Empee before it decided to join hands with UB. "But they wanted 100-per cent control right from beginning. This prevented them from making any headway in their talks with us,'' he said.

Mr Sargunar described Empee's march into UB camp as "sudden and uneventful''.

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