The Hindu Business Line : UB offers Rs 131 cr for Chhabria's stake in Herbertsons

THE UB group Chairman, Mr Vijay Mallya, has offered Rs 131 crore to buyout the 49 per cent stake owned by Mr Kishore Chhabria in Herbertsons Ltd, the country's third largest spirits company.

UB filed an application before the Supreme Court on Tuesday divulging the figure and said it was hopeful of presenting the consent terms by the next date of hearing on December 8.

A top company official said the offer was for both 43 per cent registered shares and a little over 6 per cent unregistered shares held by Mr Kishore Chhabria in Herbertsons.

This is the first time UB has stated the offer price to the court as it is pressing for a settlement to facilitate consolidation of its spirits operations spread across McDowell & Co, Herbertsons and Triumph Distillers & Vintners (TDV), which in turn would give it the financial leverage to bid for Shaw Wallace & Co's liquor business that is on the block.

It is learnt that UB is expected to finance the buyout with the help of a bridge loan from a leading domestic private bank.

However, UB's efforts for a joint application to the apex court along with Mr Chhabria did not materialise, as the latter is reportedly yet to give a final nod to the deal that could put an end to the 10-year-old ownership dispute between the two liquor czars.

The Chhabria camp has remained tight-lipped on the development indicating that several finer details of the transaction were still unresolved.

As part of the deal, Mr Chhabria would walk out of Herbertsons with BDA Ltd, a subsidiary company, which owns the popular whisky brand Officers' Choice. However, there is no clarity on the issue of losses incurred by BDA, which is carried on the books of Herbertsons.

Mr Mallya's spirits empire, with volume sales of 38 million cases, is ranked fourth largest in the world, and Herbertsons alone accounts for over 10 million cases in annual depletions.

More Stories on : Mergers & Acquisitions | Courts/Legal Issues | Breweries

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page