News: Mallya in bid for South African winery

(DNA 21/05/2006) Bangalore - Seems like it’s acquisition season for Vijay Mallya. The King of Good Times is in advanced stages of buying out a winery in South Africa — even as he has made a $767 million -- or €600 million -- bid for French liquor major Champagne Taittinger.

Sources in the UB group said the acquisition in South Africa is not as big as that in Taittinger, but it would easily be close to around $100 million, which is modest spend by Mallya’s standards.

The deal, sources say is expected to give UB group a substantial foothold in the Indian wine market, which is currently growing at around 25-30%.

Sources close to Mallya said these acquisition moves were being made to get the first mover advantage in the global market, which is going through a process of consolidation.

“He wants to be ahead in the takeover race. There would be very few companies left for acquisition, if he does not make his move now,” said the sources.

“The UB Group is pursuing significant international acquisitions in the spirits business,” is all Mallya told DNA Money, when contacted.

With these global buyouts, UB group, which controls over 60% of the Indian spirit and beer market, would be making its foray into the champagne and wine segment. Currently, Sula Vineyards is the fastest growing premium wine producer in the country, which manufactures around 11 lakh bottles annually. This year, it is planning to raise it production to 15 lakh.