United Breweries not to sell stake in South African firm

Friday, 18 July 2003, 19:30 IST
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JOHANNESBURG: United Breweries of India has no plans to hive off its South African interests but does want to find a black economic empowerment partner here. United National Breweries (UNB) president and chief operating officer Rajan Ranganathan said here that press reports in India speculating on the sale of United Breweries' stake in UNB were inaccurate. United Breweries holds 75 percent of UNB, a major player in the sorghum beer market in South Africa. Marriot Merchant Bank holds the rest. A.K. Ravi Nedungadi, chief financial officer of the United Breweries Group, was quoted in sections of the Indian media as saying the company was looking at divesting its controlling stake in UNB and would sell if it got a reasonable price. But Ranganathan Thursday told the daily Business Day here that UNB was looking for a black empowerment partner and had held discussions with a number of groups. United Breweries bought minority shareholders in UNB for 46 million rands in a restructuring exercise last year. Ranganathan said in the past year, UNB has turned around and was now profitable, so it would not be a good time to sell. He said the UNB management believed that increased profits were possible. Even though the sorghum beer market had matured, this was possible through introducing greater efficiencies in the business. At a recent public hearing on the Liquor Bill, part of a legislative process here, UNB indicated that the sorghum beer market in South Africa consumed 1.7 billion litres a year. UNB's sales revenue was about $70 million annually. United Breweries' position as India's biggest brewery is under threat from a new joint venture between its competitor Shaw Wallace and SABMiller. UNB's closest rival in South Africa, the former South African Breweries, is part of the SABMiller Group now.
Source: IANS
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