NEWS
DIEGO SELLS 32 INDIAN LIQUOR BRANDS TO INBREW TO FOCUS ON PREMIUM LABELS
By Susan Lewis
30-5-2022
Source: United Spirits Ltd.
Global drinks giant Diego will sell 32 of its local Indian liquor brands to Inbrew Beverages Pvt for INR8.2 billion (USD106 million) in a premiumisation move involving getting rid of some low-margin product lines.
United Spirits Ltd. (USL), the Indian arm of Diageo, and Inbrew announced last Friday that the sale will cover the entire business undertaking including contracts, permits and intellectual property rights with the 32 brands including Haywards, Old Tavern, White-Mischief, Honey Bee, Green Label and Romanov.
The transaction is expected to be completed by the end of the third quarter this year before 30 September.
It is worth noting that the sale excludes the McDowell’s and Director’s Special brands, which are market leaders among local Indian spirit labels.
The two companies have also entered into a five-year franchise arrangement for 11 other USL brands including Bagpiper. At the end of the franchise period, Inbrew has the right to convert the fixed-term franchise into an option to acquire the brands at a pre-agreed price.
Hina Nagarajan, CEO at USL, said the sale will allow the company to focus on premium products, as it seeks to “deliver sustained double digit profitable top-line growth”.
Since taking control of USL in 2012, Diageo has said that it would overhaul USL’s portfolio of local Indian brands to reduce overlapping which generates extra costs and self competition in prices.
Inbrew Chairman Ravi Deol, however, said that the acquisition of the brands will provide Inbrew with a platform to expand market share in the Indian market.
“Inbrew believed in the intrinsic potential of middle-class India and its growing consumption,” Deol said.
“We will revitalise these brands through expanded distribution, innovation and investments.”
“This acquired portfolio has a rich heritage with scale volumes that positions Inbrew as the top beverage player in the country,” added Deol.
(the writer can be contacted at: info@thewinechronicle.com)
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