The conversion of loans provided to McDowell and Company by United Breweries Ltd (UBL) has increased UBL's equity holding in McDowell to 44 per cent.
This follows UBL, the promoter company of McDowell & Co, earlier exercising the conversion option on 6,900,000 convertible warrants to equity shares, amounting to Rs 38 crore.
The company expects this investment to be attractive in view of the performance of McDowell and the market leadership enjoyed by it.
Also Read
Following the conversion option, the subscribed capital of McDowell has increased from Rs 44.87 crore to Rs 51.77 crore. These equity shares of Rs 10 each have been taken by UBL at a premium of Rs 45 per share.
In his annual statement, Vijay Mallya, group chairman of UBL, stated that approval has been granted for investments in China and negotiations are on, however, on a slower pace.
As part of UB's strategy in building a brand image, the company has recently picked a 50 per cent stake in the Kingfisher East Bengal Football Team through the joint venture company United East Bengal Football Team floated with East Bengal football team.
UB is all set to make a major entry into Sri Lanka for Kingfisher Lager Beer, following its performance in Nepal. It plans to set up a new brewery there as part of its long-term strategy. It hopes to initially 'seed' the market through exports. In Nepal, UBL said, it has secured a 10 per cent marketshare for Kingfisher lager beer after the launch. UB's newly launched separate division Kingfisher Mineral Water is expected to become a national brand with franchise manufacturing operations in over 10 states. This is expected to add to the group's earnings.