Bangalore, Sept 25 - India's drinks-to-airline conglomerate UB group is eyeing pacts with overseas firms to sell global spirits brands in India, but is not yet looking at acquisitions, its chief financial officer said on Monday.
Bangalore-based UB, owner of the Kingfisher beer brand through its controlling stake in India's top beer company United Breweries Ltd., became the world's third-largest spirits company after its McDowell & Co. Ltd. business bought 75 percent of Shaw Wallace & Co. in a $354 million deal last year.
It is now consolidating its spirits assets, McDowell, Shaw Wallace, and liquor maker Herbertsons Ltd., under the McDowell listing, which will then be renamed United Spirits Ltd.
This process is likely to be completed in two to three weeks, Ravi Nedungadi told Reuters.
Some of McDowell's brands -- like McDowell's No.1 Whisky and No.1 Celebration Rum -- are among the most popular Indian drinks in terms of sales volume. Shaw Wallace owns the Royal Challenge brand, while Herbertsons makes Bagpiper whiskey.
"While not being close to an acquisition, we can say that in the short-term there are various things we can do without necessarily looking at acquisitions," he said.
"Some of these arrangements and discussions could possibly lead to acquisitions as well, but as of now we are looking at two things -- distribution of brands and security of supplies."
UB group in July acquired French sparkling wine maker Bouvet-Ladubay for around $15 million.
It narrowly missed out on acquiring Bouvet-Ladubay's former parent, the Taittinger champagne house, from U.S. private equity group Starwood Capital in an auction in May.
Nedungadi said the UB group was in talks with many international spirits companies to bring some of their popular brands to India in the years ahead. He did not give details.
EXPORTS BOOST
The company is also planning to boost its overseas presence with the launch of products in new markets, including China and Russia. It currently exports beer to 52 nations including Africa, Asia and Middle East.
"There has been some interest from a major Russian company to distribute some of our products," Nedungadi said. "We also see the opportunity in China but we have not yet been able to identify the right entity to distribute our products."
He said a distribution agreement with United Breweries' joint venture partner Scottish & Newcastle Plc had also been finalised to sell Kingfisher beer in overseas markets, including the UK and other parts of Europe.
UB group, owned by Vijay Mallya, whose flamboyant lifestyle has been compared with that of British tycoon Richard Branson, plans to start selling Bouvet-Ladubay's wines in India within six months to tap a growing market, said the official.
India's wine market is estimated at 5 million bottles a year -- equivalent to around 200 people sharing one bottle -- and, at 2.75 billion rupees ($61 million), makes up less than 1 percent of India's $1.8 billion alcoholic drinks market.
But the wine market is growing at 25-30 percent a year, nearly three times as fast as the market for beer, whisky or rum, which together make up 45 percent of the total.