Heineken has taken control of India’s largest brewer United Breweries Limited cementing its position in a market with potential for significant growth in beer consumption. The Dutch brewer announced that it has bought an additional 39.64 million shares in United Breweries Ltd. With this share purchase, Heineken’s shareholding in UBL has increased to 61.50% from 46.50%. Based on Tuesday’s close at ₹ 1,466, the acquisition would be worth ₹ 5,810 crore.
Despite the steep sales decline in FY21, driven by covid restrictions, United Breweries has made sustained investment behind brands and increased footprint for premium brands.
Heineken has steadily been building its stake in UBL since taking an initial 37.5 per cent through its 2008 acquisition of Scottish & Newcastle.
UBL is the maker of the country’s top-selling Kingfisher lager and was owned by businessman Vijay Mallya, who has been declared an economic offender for defrauding banks to the tune of USD 1.04 billion. The state-run banks took possession of the stake and Competition Commission approved Heineken’s proposed acquisition of additional equity on Monday. In a tweet, the regulator said, “Commission approves proposed acquisition of additional equity stake in United Breweries Limited by Heineken International B.V.”
The tribunal allowed lenders to sell 39.6 million shares of United Breweries, 25 lakh shares of United Spirits and 22 lakh shares of McDowell Holdings via block deals on 23 June. Markets regulator Sebi also exempted Heineken International B V from the obligation of making an open offer following its proposed acquisition of shares in United Breweries Ltd (UBL). The order came after Sebi received an application from Heineken International seeking exemption from the applicability of SAST (Substantial Acquisition of Shares and Takeovers) Regulations in the matter of its proposed acquisition of certain equity shares of UBL from the recovery officer of the Bangalore Debt Recovery Tribunal (DRT) under whose custody the transfer shares owned by the Vijay Mallya Group are being held.