Financial Daily from THE HINDU group of publications
Tuesday, Jul 01, 2003
Financial Daily from THE HINDU group of publications Tuesday, Jul 01, 2003 |
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Marketing
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Courts/Legal Issues Corporate - Mergers & Acquisitions Khemka family row delays Interbrew's Indian foray Boby Kurian
BANGALORE, June 30 THE Indian foray of Interbrew, the Brussels-based world's third largest brewer, has hit a road block with its strategic partner, Sun Group, putting investment plans on hold. Sun, promoted by the Delhi-based Khemka family, partners Interbrew in Russia and had plans to extend the tie-up into the Indian beer market as well. Interbrew along with Sun had evinced interest in leading domestic brewers, UB Group and Shaw Wallace, before yielding ground to global rivals such as Scottish & Newcastle and SABMiller. Later, Sun, which was leading Interbrew's charge in India, had talked with various industry professionals to work out a detailed entry strategy, which looked at the possibility of bringing together a string of dispersed small independent brewers in the country. Sources said Sun Group's Executive Director, Mr Shiv Vikram Khemka, held discussions in this regard with certain constituents of the domestic brewing industry. However, informed sources said Sun has deferred investment plans in India as a section of the Khemka clan has moved Kolkata High Court seeking a split in the family's assets. The assets include a diversified investment portfolio operating mainly outside India. The Sun Group has been operating in the former Soviet Union since 1958 and is today the leading foreign investor in Russia and CIS. The group has set up several asset and capital management firms which functions across Europe and US. Sun's investment in India include SUN F&C, a leading mutual fund promoted as a joint venture with Foreign & Colonial of UK. Sources said Sun-Interbrew combine has not any discussion to tap the Indian beer market in the last six months. "We haven't heard anything from them for sometime now," sources added claiming that any progress in this regard was unlikely now. Besides their investment plans in the Indian brewing sector, Sun was also reportedly keen to participate in Centre's divestment drive, especially in Engineers India Ltd (EIL). Sun Interbrew, joint venture between Sun and Interbrew in Russia and Ukraine, is the leading brewer in these markets. Sun, which has presence in Russia's oil, gas and engineering sectors, entered brewing in the early 90s and went to become the second largest player in that market. In the late 90s, it effected a strategic merger with Interbrew to strengthen its hold in Russian and Ukranian beer markets. It must be mentioned that Interbrew, which effected spectacular acquisitions through out the last decade, appeared on the Indian scene lately. Interbrew's Asian presence covers markets such as China, South Korea and Thailand. This global brewer, touted as the world's local brewer, is known for promoting local brands across markets, while Stella Artois remains its international flagship brand.
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