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| UB mulls to raise $300-350 mn to reduce debt burden |
| Press Trust of India` / Bangalore Sep 30, 2009, 21:31 IST |
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United Spirits, the world's third-largest spirits maker by volume, today said it plans to raise around $300-350 million to reduce its debt burden which it mobilised to buy out the world's largest scotch producer, Whyte and Mackay.
Speaking on the sidelines of the 10th annual general meeting today UB Group Chairman Vijay Mallya said, "I have the option to sell 8.38 million treasury shares or do a QIP or look at private equity or a combination of all."
The fund raising process, he said, would happen as quickly as possible.
Out of the $625 million debt, the company said it had paid off $300 million, through sale of treasury stock and internal accruals.
On the company's growth, he said it planned to set up four large multi-substrate distilleries which could use either molasses feed stock or grain feed stock. This would help in maintaining a constant input cost, irrespective of the prices of molasses going up or down.
Commenting on the ongoing talks between the two beer manufacturers, he said, "a partnership between Heineken and UB in India in my view is a monumental event in the beer market".
According to UB group's CFO Ravi Nedungadi, USL is also exploring the option of pre-paying the remaining $325 million debt, which would help in cutting down on interest cost.
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