S&N eyes Indian market with £30m stake in Kingfisher beer
Scottish & Newcastle, Britain's largest brewer, yesterday set its sights on the potentially massive Indian market with plans to invest £60m in the maker of Kingfisher beer.
Scottish & Newcastle, Britain's largest brewer, yesterday set its sights on the potentially massive Indian market with plans to invest £60m in the maker of Kingfisher beer.
In its first major move outside Europe, S&N will invest £30m in a stake in United Breweries' beer business, which may be converted to a 26 per cent equity holding.
S&N will spend another £30m on setting up a joint venture with United to acquire more Indian breweries, with each controlling 40 per cent of the new business. The rest will be owned by the management team of the joint venture, which will be led by Ravi Jain, the former managing director of United's arch rival Shaw Wallace.
S&N will distribute Kingfisher, United's leading brand, around the world and launch its own Kronenbourg and 1664 brands in India.
Yesterday's deal gives S&N an outlet in India's fast growing market. United is the country's largest brewer and controls about 40 per cent of the market. The company is listed in India and chaired by Vijay Mallya, a flamboyant figure whose family acquired the company in 1948.
India, the world's second-most populous nation, consumes 72 million cases of beer annually, but per capita consumption is just half a litre against 18 litres in China.
As well as being Britain's biggest brewer, S&N is number one in France and number two in Belgium and Portugal. An S&N spokeswoman said: "Our main focus remains in Western Europe where we want to extend our position further but we are also very interested in developing markets."
S&N shares fell 11.5p to 544p, mainly to take account of the fact that dividends were being suspended for new shareholders.
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