United Brewaries, led by Vijay Mallaya has said that its Alcohol assets wont be used for infusing funds to the Kingfisher Airlines.
UB, whose interests span alcohol, airlines and sports teams, is under pressure to find a solution to Kingfisher’s financial troubles as the carrier struggles to meet interest payments.
However, UB will bring its foreign liquor assets under the Whyte & Mackay whisky brand and list the Scottish subsidiary, the newspaper reported citing one unnamed source close to the group, in line with plans first mooted in 2009.UB acquired Whyte & Mackay, which sells various liquor brands, in 2009 for USD 595 million.
“Each of our businesses operates independently and no transfer of resources is envisaged from one operating entity to another,” UB Group Chief Financial Officer Ravi Nedungadi told Reuters. “From the day we acquired Whyte & Mackay, we said we would consider listing it at some point. The point is not now.”
UB, controlled by the flamboyant Indian businessman Vijay Mallaya, acquired Scottish whisky brand Whyte & Mackay (W&M) in 2007 for 595 million pounds.
The Economic Times, citing an unnamed source, reported on Monday that UB planned to consolidate its foreign liquor assets under the W&M brand ahead of a foreign listing as part of a strategy to assist the cash-strapped airline.
Kingfisher, hit by rising costs, fierce competition and a slowdown in the Indian economy, was forced to cancel flights late last year and is having trouble making interest payments and paying salaries to employees.
The airline owed 600 million rupees in service taxes as of last Tuesday. It also owes the government about 1.3 billion rupees of income tax deducted from employee salaries.
“Any plans we may have for W&M have nothing to do with Kingfisher Airlines,” UB Group spokesman Prakash Mirpuri told Reuters. “However, there are no immediate plans in the offing.”
Shares in United Breweries Ltd (UBBW.NS), the UB Group’s flagship company, were up 5.3 percent at 468 rupees at 1230 (0630 GMT), having risen as much as 6 percent in early trading. The overall market was down 0.34 percent.