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Business Standard
5 days ago
- Business
- Business Standard
Tilaknagar tops $600 mn race for Imperial Blue, to expand whisky portfolio
Tilaknagar Industries, known for its Mansion House and Courrier Napoleon brandies, is emerging as the front-runner to buy the popular Imperial Blue whisky from French alcohol giant Pernod Ricard, according to a report by The Economic Times. The Imperial Blue brand is estimated to be worth up to $600 million. If the deal goes through, it will be the largest acquisition in India's liquor sector in over a decade — after Diageo's $1.9 billion buyout of United Spirits in 2013, the news report said. Inbrew Beverages, founded by London-based entrepreneur Ravi Deol, is also interested in acquiring Imperial Blue. However, Pernod Ricard found Tilaknagar's offer more attractive, though Inbrew has not been completely ruled out, The Economic Times mentioned. Tilaknagar, India's fifth-largest alcohol company by market value, has been asked to submit a binding bid by June 23. Funding the deal If the deal goes through, it will be funded through a mix of internal resources, bank loans, and private equity investment. Japan's Suntory Holdings, which owns brands like Jim Beam and Maker's Mark, initially considered bidding for Imperial Blue but later decided not to move forward. For Tilaknagar, led by chairman Amit Dahanukar, buying Imperial Blue would be a big step in diversifying its portfolio. While the company entered the whisky segment in 2012 using its flagship Mansion House brand, over 90 per cent of its sales still come from brandy. During its earnings call on May 21, Dahanukar said the company plans to grow its presence in brandy and other Indian-made foreign liquor segments through its own brands and strategic acquisitions. Tilaknagar has previously acquired Round The Cocktails, Spaceman Spirits, and Incredible Spirits. Imperial Blue's journey Imperial Blue was first introduced in India in 1997 by Canadian distiller Seagram. In 2001, Seagram sold its global business to Pernod Ricard and Diageo, with Pernod Ricard taking over the Indian business. The following year, Imperial Blue was relaunched with the memorable slogan, 'Men will be men', which helped build a strong following. Today, Imperial Blue is the world's eighth best-selling whisky, selling 22.8 million nine-litre cases in 2023, according to Drinks International's Millionaires' Club. However, this is down from its 2019 sales of 26.3 million cases, the news report said. This potential sale echoes Diageo's decision in 2022 to sell 32 low-margin Indian brands — including Haywards, Old Tavern, White Mischief, Honey Bee, Green Label, and Romanov — for ₹820 crore to Inbrew. Deol, who started Barista Coffee in 1999 and earned a reputation as India's 'coffee man', aims to make Inbrew a leading player in the alcohol industry by acquiring Imperial Blue.
Time of India
5 days ago
- Business
- Time of India
Brandy boss Tilaknagar eyes Imperial Blue in $600 million whisky chase
Tilaknagar Industries , the maker of Mansion House and Courrier Napoleon brandies , is the frontrunner in the race for the Imperial Blue whisky brand being sold by the French alcobev major Pernod Ricard , people familiar with the matter told ET. The brand has an estimated enterprise value of up to $600 million, and a deal will mean the largest M&A in India's liquor industry in more than a decade after Diageo 's buyout of United Spirits in 2013 for $1.9 billion. Inbrew Beverages , established by London-based serial entrepreneur Ravi Deol, is also in the reckoning. However, Pernod Ricard has found Tilaknagar's offer to be better, the people said, though Inbrew is not completely out of the running. As preferred party, Tilaknagar, which is India's fifth-largest alcoholic beverage firm by market cap, has been asked to submit a binding bid by June 23, the people said. Adding shine to brand, expanding portfolio Any potential deal will be financed through a combination of internal accruals, bank borrowings and private equity funding, they added. Japan's Suntory Holdings, owner of Jim Beam and Maker's Mark whiskies, initially showed interest in Imperial Blue but decided not to pursue the deal, they added. For homegrown Tilaknagar, led by Amit Dahanukar, a successful acquisition of Imperial Blue would help expand its brand as well as non-brandy portfolio. While brandy is a dominant category in Tilaknagar's portfolio, the company forayed into whisky in 2012, leveraging flagship brand Mansion House. However, more than 90% of its sales still comes from brandy. During its earnings call on May 21, chairman and managing director Dahanukar said Tilaknagar will focus on enhancing its presence within brandy and other Indian made foreign liquor (IMFL) categories through its own brands and strategic investments. Tilaknagar Industries has earlier acquired Round The Cocktails, Spaceman Spirits and Incredible Spirits. 'We regret we are unable to comment on the subject,' Dahanukar said in response to ET's query on the proposed deal. Imperial Blue ranks as the eighth bestselling whisky worldwide. In 2023, it sold 22.8 million nine-litre cases, according to Drinks International Millionaires' Club. Although these numbers are strong, sales are down from 2019, when it sold 26.3 million nine-litre cases. Imperial Blue was introduced in India by Canadian distiller Seagram in 1997. In 2001, Seagram sold its global business to Pernod Ricard and Diageo. The French company then took over the Indian business. In 2002, Pernod Ricard relaunched Imperial Blue with the advertising slogan 'men will be men.' Its success has grown year on year, making it Pernod Ricard's largest brand by volume, according to the company's website. Much of its success is credited to its memorable advertising line, which created a strong following in India. Selling Imperial Blue marks a change in focus for Pernod Ricard in the region. It aims to grow its premium brands like Glenlivet, Jameson and Chivas Regal. 'Pernod Ricard regularly reviews strategic options for its development, including its brand/business portfolio," said a company spokesperson, while declining to comment on the proposed deal. This move mirrors how UK drinks company Diageo sold 32 low-margin Indian brands, such as Haywards, Old Tavern, White Mischief, Honey Bee, Green Label and Romanov, in 2022 for ₹820 crore. The brands were bought by Deol's Inbrew. Deol is famous for starting Barista Coffee in 1999, which made him known as India's coffee man. By acquiring a stake in Imperial Blue, Inbrew aims to become one of the leading players in the industry. The company could not be reached for immediate comment. People aware of developments said Imperial Blue's valuation, among other factors, is also compared with listed drinks companies' valuations, which are 20–30 times operating profits. When estimating the value of a target asset, the discounted cash flow method is also used. This method values an investment by considering future cash flows.
