Business Daily from THE HINDU group of publications
Wednesday, May 30, 2007
ePaper
Business Daily from THE HINDU group of publications Wednesday, May 30, 2007 ePaper |
|
|
|
|
|
|
|
Corporate
-
Mergers & Acquisitions Scotland still lukewarm to Mallya K. Giriprakash
Keith, Scotland, May 29 He tries to make his competitors underestimate him," says one of the officials of a leading Scotch whisky company in Scotland. There is a mix of admiration as well as a bit of fear among officials of several Scotch whisky companies about Mr Vijay Mallya, Chairman of the UB Group, which last week bought Scotland-based Whyte & Mackay for $595 million. Not everybody is happy either probably because there is a lot of uncomfortable feeling about the whole deal. In a country where employees normally stick to their jobs till they retire and are conservative by nature, flamboyance is not seen as a virtue and Mr Mallya is seen as someone who has carefully cultivated such an image.
Nice gesture
But the fear arises out of how Mr Mallya will operate his new acquisition. There is a debate on whether he will Indianise the company or will let the company run as it used to be run earlier. Soon after the previous owner of Whyte & Mackay, Mr Vivian Imerman, was handed over the cheque by Mr Mallya, he immediately declared a three-month bonus to his 600 employees. It is a gesture that has been well appreciated by the Scots. "This type of corporate generosity is incredibly rare - most of the upper echelons who come by huge profits tend to pocket it. I am really pleased that such a large and unexpected profit sharing came from within the Scotch whisky industry," says the highly respected Scotch Blog.
Not taking chances
But the big question is whether Mr Mallya will now be able to influence the Indian Government to lower the basic import duty of 150 per cent on imported foreign liquor including Scotch. While everyone is looking forward to it, the Scotch Whisky Association is not taking any chances. It is happy to talk with Mr Mallya but on its own terms. While a few blogs have suggested that the SWA is trying to be a bully, there are others who believe that the association should do everything to protect its members from the onslaught of outsiders. The same Scotch Blog in a recent post says that "it is apparent to anyone with even a cursory knowledge of the issue that the Indian Government is playing protectionism at its most blatant - and spitting in the face of free-market economies - all the while whining about not being allowed open access to markets." The fact that Mr Mallya is also a member of the Parliament does not help matters either. Soon after the acquisition was announced the blog asked: Will India mysteriously and suddenly cave in to WTO demands and remove the tariffs, or does Mallya have something up his sleeve whereby Indian-owned products get the same pass as Indian-made products? Such questions will continue to haunt the Scots for at least sometime to come. But certainly nobody is taking Mr Mallya lightly anymore.
More Stories on : Mergers & Acquisitions | Breweries | Human Resources
Article E-Mail :: Comment :: Syndication :: Printer Friendly Page
|
Stories in this Section |
|
The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription Group Sites: The Hindu | The Hindu ePaper | Business Line | Business Line ePaper | Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |
Copyright © 2007, 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
|