Financial Daily from THE HINDU group of publications
Thursday, Apr 14, 2005
Financial Daily from THE HINDU group of publications Thursday, Apr 14, 2005 |
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Corporate
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Courts/Legal Issues UB not to pursue SWC case over BDA Boby Kurian
Bangalore , April 13 THE UB Group has disclosed that it has decided not to pursue the legal case initiated by Shaw Wallace & Co Ltd (SWC) to regain control of the Kishore Chhabria-managed BDA Ltd, which owns the popular Officers' Choice Whisky. SWC, under its late Chairman Manu Chhabria, and later through his estate, has been fighting a legal battle staking claim over BDA. The legal dispute followed a bitter split between the Chhabria brothers, with the younger Mr Kishore Chhabria moving out of the SWC fold by wresting control over BDA and some other assets in 1992. Subsequently, as part of a rapprochement in the late 90s, the two brothers buried a slew of legal cases between them but could not settle on the matter concerning BDA. However, the UB Group, which last month signed a Rs 1,300-crore deal to snap up SWC, said it was likely to drop the case against BDA. "We are not interested in pursuing this legal dispute. We are no more interested in legal matters, and that is absolutely clear," a senior source in the UB Group told Business Line. The UB Group Chairman, Mr Vijay Mallya, and Mr Kishore Chhabria recently parted ways from a messy joint venture relationship in Herbertsons Ltd, parts of the UB spirits network. BDA's annual sales are pegged at about five million cases, and the company is in the midst of an equity and financial restructuring. Interestingly, UB's disclosure that it would not pursue the case against BDA comes at a time when Mr Chhabria has revamped his company's top management by inducting former UB officials, including an influential and key advisor to Mr Mallya. Mr S.S. Gandhi, a former head of UB's spirits business, has joined BDA as an advisor. The septuagenarian industry bigwig, known for his proximity to Mr Mallya, is said to have joined BDA with "a nod" from the UB chief. Mr Chhabria has also inducted two more ex-UB officials into the BDA top brass. Mr D.S. Mathur has been taken on board as chief executive officer, while Mr V.K. Luthra has been appointed as director in-charge of sales and marketing. Sources close to Mr Mallya said these new appointments in BDA would help in striking synergies in marketplace competition. "Officers' Choice, in tandem with UB's Bagpiper and SWC's Director's Special, is a great force in the regular-priced whisky segment, and we hope to have a synergistic relationship avoiding wastage in below-the-line trade incentives," the source added.
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