E-Malt.com News article: India: SABMiller to pay Rs 400 crore for 51% in Mohan Meakin

South Africa’s $15.3-billion SABMiller Plc - one the world’s largest brewer - will acquire a 51% stake in Mohan Meakin Limited’s brewery business for Rs 400 crore, as per the valuation of its advisor KPMG which has submitted its report, The Financial Express released September 13.

Mohan Meakin will retain 49% stake. The deal will be signed by the end of the month. Asia Pacific Brewers were the other bidders for the company. The SABMiller spokesperson declined to comment.

The acquisition will catapult SABMiller, which entered India as recently as 2000, to share the No.1 slot in the Rs 3,000 crore, 113-million cases beer industry with Vijay Mallya’s United Breweries with around 48% stake each.

Mohan Meakin, whose Golden Eagle and Black Night brands account for 8% of the market, has got a valuation better than Foster’s India, whose brands and assets were acquired by SABMiller in August for $120 million (Rs 552 crore). At Rs 400 crore for the 51% stake, Mohan Meakin’s brands and assets are valued at Rs 784 crore.

Deal Binge

• 2000: Narang Breweries
• 2001: Mysore Breweries
• 2003:50% in Shaw Wallace
• 2005:50% more in Shaw Wallace
• 2006: Foster's India

After Foster’s acquisition, SABMiller’s market share in the beer segment jumped to around 40%, while Mohan Meakin’s 8% will bring it neck and neck with UB.

SABMiller has 10 breweries spread over nine states, producing brands like Royal Challenge, Haywards, Castle Lager, Foster’s Lager and Amberro.

Analysts said the deal with Mohan Meakin could not have come at a better time for SABMiller as international beer brands like the world’s largest beer brand by value InBev and Heineken having announced their intention of entering the fast growing Indian market.

What attracts them to India is that the beer sector is growing at 12% per annum.


16 September, 2006