The shareholding pattern of United Distillers & Vintners India has undergone a change with Standard Chartered Bank picking up a 10 per cent stake in the liquor company, part of Diageo Plc, among the world's largest spirits and wines companies.
The change is in accordance with the existing norms, which stipulate that the foreign company's stake in the Indian outfit has to be brought down to 60 per cent by 2005. UDV has been operating in India since 1994.
The original Indian partner -- the Kilachands of Polychem Ltd -- had initially held a 40 per cent stake but gradually brought this down to 5 per cent.
"Now Stanchart holds 10 per cent and the rest is held by the parent company. As per the norms, Diageo needs to shed its stake by another 30 per cent by next year," a source close to the company said.
Meanwhile, the Foreign Investment Promotion Board has referred UDV India's application seeking waiver from the investment clause for setting up manufacturing facilities to the department of industrial policy and promotion. The FIPB has asked the DIPP to submit a status report on UDV India.
Sources said the outfit moved the FIPB as it is uneconomical to set up manufacturing units with low volume global brands.
"The company would like to invest in building premium brands and marketing and not in setting up a manufacturing unit," the source said. UDV India's sales are around 200,000 units versus the UB group's spirits sales of over 500,000 units.
UDV India argues that the low volumes do not justify setting up facilities for bottling brands like Smirnoff Vodka, Vat 69 Scotch whisky, Black & White Scotch, Gilbey's gin, Christian Brothers rum and brandy and Archer's Peach Schnapps.
The company had sometime back restructured its operations by selling its high-volume low-priced whisky business under the Gilbey's brand and focusing only on the premium brands.
The government had granted a licence to the company to set up a facility to produce 10,000 hecto litres. At present, its products are produced from third-party bottlers in Aurangabad, Indore and Rajasthan.
