Vijay Mallya acquires French winery
The all-cash deal will enable Mallya's spirits division McDowell to import high quality wines in bottled and bulk forms.india Updated: Jul 13, 2006 21:47 IST
With the acquisition of the 155-year-old Bouvet Ladubay SAS for euro 14.75 million (Rs 866 million), UB Group chairman Vijay Mallya is now preparing to introduce the French wine in India.
The all-cash deal, facilitated by Asian Opportunities and Investments Ltd, UB's wholly-owned subsidiary in Mauritius, will enable Mallya's spirits division McDowell to import high quality wines in bottled and bulk forms and market them for connoisseurs across the country.
According to a company statement in Bangalore on Thursday, the acquisition will also allow UB to assimilate leading edge viticulture from Ladubay, considered the home of wines, on wine making and make foray in European and US markets for hard-selling its other products.
"Ladubay will give us access to wine technology of the highest order. We will use its technology to develop our own vineyards and wineries for a sustainable growth and maintain our leadership in the spirits market," Mallya said earlier while bidding for the French winery.
As a long established winery, with its origins dating back to 1851 in the Loire Valley of France, a popular wine growing region, Ladubay produces sparkling wines by using the traditional "methode champenoise".
"Its distinctive and superior quality of wines command a premium price in France, Germany, Britain and US," the statement said.
In 2005, the French subsidiary posted a turnover of euro 12 million by selling about three million wine bottles, with euro one million in gross margin.
It may be noted Mallya's efforts to buy out Champagne group's Taittinger in May was upstaged by the French regional bank Credit Agricole du Nord Est by quoting a higher price than UB, which had bid Rs 30 billion ($650 million).
"Credit Agricole was the winning bidder. There is a sentiment that Champagne assets should remain in France. So we peacefully bowed out of the process.
I was not prepared to get into a bidding war because that would have diluted the shareholder value of UB, for which I was not prepared," Mallya pointed out after withdrawing from the race.