UB highest bidder for Shaw Wallace

UB Group chief Vijay Mallya on Thursday confirmed that the group's bid for Shaw Wallace had turned out to be the highest of the three received and added that the ball was now in the sellers' court.

Mallya was particularly happy "" " we feel good" "" that the bid had been professionally priced as all the bids were close but UB's turned out to be the highest while paying a "full price".

UB hired Accenture to help it evaluate the business and formulate its bid while Shaw Wallace mandated McKinsey to conduct the bidding process.

The merger will create a behemoth as the current combined market share of UB, Scottish & Newcastle, Shaw Wallace and SAB Miller in beer is 90 per cent and the combined market share in spirits is 55 per cent. The merged entity will become the largest spirits company in the world.

Mallya, who addressed the media after an extraordinary general body meeting of United Breweries to obtain approval for the management's decision to make a preferential allotment in favour of Scottish & Newcastle, said he had reassured shareholders that he would continue to retain control.

Under an agreement he would continue to nominate the chairman and the managing director. As a result of the allotment and a 20 per cent open offer, S&N's holding in UB could go upto 37.5 per cent.

The shareholders also approved the UB management's decision to acquire for Rs 180 crore the entire ownership of Karnataka Breweries and Distilleries, making it a wholly-owned subsidiary, and float a bottle trading company so as to also conduct the business of securing and recycling used beer bottles.