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Tilaknagar Inds gains after board OKs to acquire 36.17% stake in Bartisans

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Last Updated : Sep 19 2024 | 1:04 PM IST

Tilaknagar Industries advanced 1.43% to Rs 307.30 after the company's board has approved an investment of Rs 8.03 crore in Round the Cocktails Private (Bartisans) through a mix of primary investment and secondary acquisition.

As a 'ready to pour' beverage company, Bartisans is engaged in the business of developing, producing, marketing and selling non-alcoholic beverages which can be mixed with alcohol to create cocktails, and can also be consumed on their own as mocktails. Its turnover was Rs 3.5 crore in FY24.

The company will hold 36.17% stake in Bartisans on a fully diluted basis, following a combination of primary funding and secondary share acquisition. The founders of Bartisans will retain a controlling interest with 56.54% of the equity share capital, while the remaining shares will be allocated to an Employee Stock Ownership Plan (ESOP).

The company will subscribe 2,352 compulsory convertible preference shares (CCPS) and 1 equity share of Bartisans, representing 13.52% of its share capital on a fully diluted basis for Rs 3 crore. The company will purchase from existing shareholders, 163 equity shares and 3,781 CCPS of Bartisans equivalent to 22.65% of share capital on a fully diluted basis for Rs 5.03 crore. Upon completion of the investment, the firm will hold a total of 36.17% of Bartisans.

The funds will be utilized towards growth and marketing initiatives and to further strengthen the distribution of Bartisans products. As per the agreement, the firm has also had the right to nominate a director on the board of Bartisans. The investment in Bartisans will be funded through companys internal cash resources.

The acquisition is set to be completed on or before 15 November 2024. Upon Bartisans meeting specific pre-agreed milestones, the firm has the option to invest in or acquire additional shares at a predetermined valuation.

The Ready to Pour mixer industry in India is projected to touch Rs 7,000 crore ($ 830 million) by 2030. Furthermore, in 2023, the Global Cocktail Mixers market size was estimated at $ 10 billion which is expected to grow by 9 per cent CAGR, to $21 billion by 2031, the company stated in exchange filing.

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Amit Dahanukar, chairman and managing director, Tilaknagar Industries, said, Our investment is driven by the emergence of a booming cocktail culture in India, paired with the growing trend of at-home drinking in a convenient setting. Through this association we also see strong synergies with our existing premium brandy as well as our soon-to-be-launched luxury portfolio. We look forward to working closely with Bartisans for co-creating innovative cocktail mixers for brandy.

With its premium price point, high gross margins and high customer retention rates, Bartisans enjoys strong unit economics, enabling a diverse range of distribution channels from directto-consumer to modern retail to quick commerce, Dahanukar added.

Ameya Deshpande, President Strategy and Corporate Development, Tilaknagar Industries, said, Bartisans has developed mixers with unique, in-house recipes that resonate with the Indian palate and add a twist for an extraordinary drinking experience. Its products evoke strong customer loyalty, a trait it shares with our leading brands, Mansion House Brandy and Courrier Napoleon Brandy. I also see this partnership contribute significantly to making brandy more fun, exciting and aspirational.

Jovita Mascarenhas, Co-Founder, Round the Cocktails said, Tilaknagar Industries' expertise in the alco-bev sector coupled with our vision for innovative cocktail experiences creates an exciting opportunity to scale Bartisans to new heights. We are confident that this partnership will elevate our brand and expand our reach across the market.

Tilaknagar Industries is an alcoholic beverage company. The Company is primarily manufactures, markets and distributes spirits. The company's product portfolio includes whisky, brandy, rum, vodka, and gin.

The companys consolidated net profit surged 55.7% to Rs 40.09 crore in Q1 FY25 as against 25.75 crore posted in Q1 FY24. Revenue from operations grew by 3% year on year (YoY) to Rs 313.16 crore in the quarter ended 30 June 2024.

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First Published: Sep 19 2024 | 12:00 PM IST

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