NEW DELHI : Liquor major United Spirits Limited (USL), on Friday announced the sale and franchise of more than 30 popular brands to Inbrew Beverages for an estimated amount ₹820 crore, the company said in a statement.
“USL and Inbrew have signed definitive agreements for the sale of the entire business associated with 32 brands, including iconic brands Haywards, Old Tavern, White-Mischief, Honey Bee, Green Label and Romanov, for consideration total cash of approximately ₹820 crore, subject to customary adjustments,” the company said.
The sale comes more than a year after USL launched a strategic review of some popular brands to focus on premiumizing its portfolio in India.
The sales portfolio covers the entire commercial enterprise associated with the 32 brands, including contracts, licenses, intellectual property rights, associated employees and a manufacturing plant.
“In addition to the above, USL and Inbrew have entered into a five-year franchise agreement for 11 other brands, including Bagpiper,” he added.
The transaction does not include the McDowell’s or Director’s Special brands, which will be retained by USL. The company expects to complete the transaction by the end of the quarter ending September 30, 2022.
USL has also granted Inbrew the right, subject to certain conditions, to convert the fixed-term franchise agreement into one with perpetual use rights and/or a purchase option to acquire the marks at a price agreed in advance. Certain ancillary agreements, including transitional services agreements, related to the sale of the business enterprise and franchise and option agreements have been approved for signing between USL and Inbrew, the company added.
In FY22, USL’s popular segment accounted for 26.2% of net sales, down 2.6 percentage points from the same period last year.
“The transaction reflects the continued evolution of Popular’s portfolio management since 2016, when the company transitioned to a franchise model in many states, to enable an increased focus on ‘Prestige & Above’,” said Hina Nagarajan, Managing Director and CEO. , USL.
The move is expected to “reshape” USL’s portfolio to deliver sustained profitable double-digit growth, Nagarajan said.
InBrew is largely a beer-focused company with two breweries in India. It manufactures and distributes a variety of beers, including Blue Moon and Miller. In 2021, the Singapore-based company, owned by British entrepreneur Ravi Deol, acquired the beer business of Molson Coors Brewing Co. in India.
Ravi Deol, President of Inbrew, said, “Inbrew will revitalize these brands through expanded distribution, innovation and investment. After acquiring the beer business of Molson Coors last year, we will now participate in the consumer spirits category, making AlcoBev a diverse player in Inbrew India.”