Ub Plans To Put Arms Into One Bottle

All distillery units of the United Breweries (UB) group are to be soon amalgamated into a single corporate entity on a consolidation drive to emerge as a value-based corporate house, a top executive of McDowell, an of the group, said yesterday.

McDowell and Co, McDowell Spirits, Udaipur Distillery, Vitari Distilleries, Serampore Distillery and Chemicals, Mysore Wine Products and McDowell Properties, would be merged into one corporate entity, named McDowell and Co, chairman Vijay Mallya said after the 102nd annual general meeting here.

After the restructuring, the manufacturing capacity of the company will go up to 12 million cases per annum from the present nine million cases. The merger would also result in several advantages like an improved turnover and a better profitability.

 

He said the company had registered a record growth of 19 per cent in volumes in 1999-2000. Sales of 17.33 million cases had enabled the company to increase its market share to 26 per cent, nearly twice of its closest competitor, Mallya said.

He noted that for the past five years, the present DMK government in Tamil Nadu had not given a price increase for the McDowell products despite repeated requests from the company.

The cost of production had gone up by 50 per cent and the government should come forward to give a hike.

The Andhra government had given an increase following a court directive. Similarly, the Tamil Nadu government should follow suit, he added.

"We will shortly meet chief minister Karunanidhi to make a well-prepared and justifiable representation," Mallya said. He, however, added that his company was not thinking of moving the court in this case.

The Tamil Nadu State Marketing Corporation (Tasmac), the wholesale agency for liquor supplies in the state, should give anywhere between Rs.15 and Rs.30 for 180 ml of liquor, as against Rs.6 being given now, so that newer brands could be pumped in to the state market, Mallya said.