UB nearing S Africa wine firm buyout

UB group-owned United Spirits is in advanced talks to acquire a South Africa-based wine company, which also has a decent presence in the UK. This follows the company's acquisition of France-based Bouvet Ladubay for close to $20 million.

Vijay Rekhi, president, United Spirits, said: "We are rolling out an aggressive strategy to grow our wine business. After the recent acquisition in France, we are in negotiations with a wine firm in South Africa and are debating on the valuation. We will have clarity on the deal in the near future."

Some key wine makers in South Africa are Blouvlei, Indlhezani Inv, House of Lindiwe, Kholisa Wines, Kuyasa Wines, LaThiTha Wines, Mia Cara Wines, Phumlani Wines, Remogo Holdings, Sibeko Wines and Vunani Wines.

If the South African acquisition goes through, it will bolster UB group's long cherished ambition of being a premium player in the wine segment.

With the acquisition of Bouvet Ladubay, UB gets to introduce high quality wines (both bottled in origin, in France and bulk imported to be bottled locally) to the emerging wine connoisseur in India.

It will also assimilate leading edge viticulture from the Home of Wines on wine making, into India and will take advantage of established distribution in Europe and US to push other products from its portfolio in the west.

UB group has two wine brands, Golconda and Bosca, in the mass market which sells at around Rs 200 for a 750 ml bottle. The group is evaluating the introduction of three premium wine brands of Bouvet Ladubay in India with a price tag of over Rs 1,000.

The French company had sales of over 3 million bottles last year resulting in revenue of close to $15 million. The company's product are priced at a premium in France, Germany, UK, USA besides other countries.

Rekhi further added that UB group was looking at putting up a winery, most probably in Nashik. The unit, to have an initial capacity of around 100,000 cases, will see an initial investment of around Rs 8 crore. The company is also evaluating options for acquiring wineries, if needed.