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Allied Blenders & Distillers to Sell 12% Stake to TPG & Carlyle; Keen on Tilaknagar Deal

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(ABD), which owns the mass-whisky Officer’s Choice, will divest up to 12 percent of its stake to two overseas PE players — TPG and Carlyle Capital — for about USD 250 million to fund its expansion and growth through buyouts, according to PTI reports.

The company, promoted by of the Shaw Wallace fame, has also reiterated its intention to pursue its talks with Tilaknagar Industries, despite the fact that talks are stuck on valuations.

, Vice-Chairman and Chief Executive Officer, Allied Blenders & Distillers, said: “We have signed two term sheets with Carlyle and TPG already. We are looking at raising USD 200-275 million in part equity and debt and are ready to divest up to 10-12 per cent to them.”

He further added: “The money will be used for expansion and capacity addition, which also includes buyout. The company has lined up Rs 450 crore to Rs 500 crore capex this fiscal, which will be used for acquisition and bottling capacity expansion.”

Roy also mentioned that the company is keen to buy Tilaknagar Industries, the makers of the Mansion House brandy, but Tilaknagar Industries is demanding an exorbitant amount, which ABD is not ready to pay.

“We don’t want to end up getting sick by stretching our balance sheet too thin. Having said that, I want to reiterate that we are still keen on the takeover and not a minority stake in the company.”

After the management of the UB group changed hands practically and became majority foreign-owned recently, ABD with 25 million cases in sales last fiscal claims to have become the largest domestic player.

Roy stated that ABD is not interested in any other buyout as there is a great synergy between Tilaknagar and his company in which he owns five percent stake.

“They are strong in the South with the Mansion House brandy brand, while we are strong only in the Andhra market down South where we are keen to increase our footprint.”

Tilaknagar’s Mansion House is equally owned by ABD and the Dutch liquor maker Herman Jansen. Tilaknagar bought 50 percent local sales rights from the Dutch owner last October.