Suntory, Tilaknagar Industries in race to buy Imperial Spirits

Japan's second-largest brewing and distilling company Suntory Holdings and Mansion House brandy maker Tilaknagar Industries, are in the race to buy Coimbatore-based Imperial Spirits.

The Economic Times today reported, citing three unnamed sources, that the promoters of Imperial Spirits will sell their entire stake in the company, while private equity firm Lighthouse Funds, which had invested a reported $4.85 million in 2008, could get about fourfold returns from the sale.

The report said that Imperial is valued at around $100 million (Rs600 crore).

Founded in 2003, Imperial, which started its operations in Goa and later in Karnataka and Kerala, is a manufacturer and marketer of branded mid-market Indian made foreign liquors (IMFL).

With licenses in five states and production of more than 500,000 cases of IMFL a month, Imperial also does contract production for whisky, rum, brandy, vodka and gin for other leading brands under bottling agreements. 

It exports its products to countries in the Middle East, Sri Lanka, Angola, Tanzania, Congo, Namibia and Morocco, and is planning to enter Spain, according to its website.

Suntory, which is acquiring Beam Inc of the US for $13.6 billion in a deal that would enable it to emerge the world's third-largest spirits maker, has recently been making acquisitions and developing business partnerships with major beverage companies in a bid to rapidly expand its global footprint (See: European regulator approves Suntory's $13.6-bn Beam deal).

With more than 90 per cent of its annual sales of around $11.2 billion being generated from Japan, the Osaka-based company's leading brands include Yamazaki, Hakushu, Hibiki, and Kakubin, Bowmore Scotch whisky and Midori liqueur.

Since the past four years, Suntory has acquired European drink maker Orangina Schweppes, New Zealand's second-largest beverage maker Funcor Group, Lucozade and Ribena brands from GlaxoSmithKline.

It has also formed a joint venture with Indonesian's beverage and food group Garudafood, and formed a strategic alliance in 2012 with PepsiCo in Vietnam.

Tilaknagar Industries, based in Shrirampur, in Ahmednagar district of Maharashtra and best known for its Mansion House and Courrier Napoleon brandies, is a major independent producer of Indian-made foreign liquor, including whisky, brandy, gin, rum and vodka.

The company manufactures, markets and sells more than 40 brands across all price points. It also operates subsidiaries like Prag Distillery, Vahni Distilleries, Kesarval Springs Distillers and Punjab Expo Breweries.

The company exports its products to Western Africa, the Middle East, the Far East and the Caribbean.

Last month it acquired the complete spirits business of Kolkata based IFB Agro in order to expand its sprits portfolio with the addition of brands like Leonov, Russki (vodka), Goldcup, Benjamin (brandy), Jubilation, Baluba (rum) and 3 Cheers (whisky) (Tilaknagar Industries buys out IFB Agro's spirits business).