Bhopal-headquartered Som Distilleries and Breweries Ltd said it has plans for two strategic acquisitions this year to improve footprint in the domestic liquor market.

Group Chairman J K Arora said that the while one will be a contract liquor manufacturing firm based out of Chhattisgarh, the other will be a Tamil Nadu-based liquor firm.

“We will be acquiring Legend Distilleries which does contract manufacturing for a consideration of Rs 50 crore. The other acquisition is still in due diligence stage and the deal size is estimated at Rs 400 crore,” Arora said, adding that he expects to close both the deals by the end of the current fiscal. The company said the two acquisitions will give it reasonable foothold in southern and western markets.

European investment firm Bryan, Garnier & Co has been appointed as the investment banker to mandate the deals. It will be finding investors for making strategic acquisitions and development of greenfield breweries and distilleries for Som Distilleries.

Arora said the company is also looking to set up greenfield facilities in Haryana and Tamil Nadu. “Every State has different taxation structure. Having own facilities will take care of taxation bottlenecks,” he added.

The company has brands such as Hunter Beer, semi premium whiskey Milestone 100, and White Fox Vodka. It has presence in markets such as Madhya Pradesh, Chhattisgarh, Madhya Pradesh, Orissa, Pondicherry, among others. Madhya Pradesh accounts for a bulk of its market.

The Indian liquor industry has strong MNC presence with brands such as Diageo, Beam Global, Pernod Ricard, Heineken, SAB Miller and Carlsberg. There are three broad categories — Indian manufactured foreign liquor (which includes whiskey, rum, brandy, vodka and gin), beer and country liquor (cheaper, spiced liquor).

According to various estimates, each of these segments has a volume of between 230 million and 260 million cases a year.

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