Cobra Beer acquires Iceberg, eyes expansion
Iceberg currently has a manufacturing capacity of three million cases per year and Cobra plans to raise this capacity to seven million cases in a few years, reports Radhika Pancholi.Updated: Jan 18, 2008 21:13 IST
He likens the return of the Cobra brand to India in 2005 as "return of the NRI", and has just made the company's first acquisition—with the purchase of Bihar-based Iceberg breweries—in the country where it all started. Yet, Lord Karan Billimoria, founder and chairman, Cobra Beer feels that this is just the beginning of what he terms to be the "blockbuster' in the beer industry.
"We began Cobra Beer in 1992, when we started brewing beer for the UK market from Mysore breweries in India. In 1997, we shifted the manufacturing base to the UK. But I always believed in the India story and soon we began importing beer from the European market, only to begin brewing it in India again in 2005," Billimoria said, adding that while Cobra had a contract agreement with six breweries, their acquisition of Iceberg was the first in India. And the brewer is not stopping at that.
Giving an outline of Cobra Beer's expansion plans, Billimoria said: "We are planning a greenfield plant along with three more acquisitions, one each in North, Hyderabad and the Western region in the next three years. We have put aside $5 million for this purpose".
"A part of this investment fund went into buying Iceberg," he said, while declining to give the exact cost for acquiring a 76 per cent stake. The balance remains with Amit Katyal, the original owner of the only brewery in Bihar.
Iceberg currently has a manufacturing capacity of three million cases per year and Cobra plans to raise this capacity to seven million cases in a few years. "While the UB Group and Sab Miller are the current leaders in the beer market with almost 70 per cent of the market currently, we are the second-largest as far as mild beer is concerned," Poonam Chandel, COO, Cobra Indian Beer said. She said Cobra has sold three million cases so far in this financial year.