INDIA – United Spirits Limited (USL), the Indian subsidiary of the global liquor company, Diageo has entered into a share purchase agreement for the sale of its entire equity share capital in its wholly owned subsidiary Four Seasons Wines (FSWL) to Grover Zampa Vineyards and Quintela Assets.
The sale also includes all associated brands and 100% of the paid up equity share capital of Four Seasons Wines, meaning that FSWL will cease to be a subsidiary of USL at the close of the transaction.
The company said the divestment was part of USL’s strategy to successfully continue to monetise its non-core assets, including subsidiaries.
“This deal brings us a step closer to the structural rationalisation and simplification of our India business.
The FSWL wine business is a niche but a small part of the overall Diageo India portfolio and the sale will enable us to focus on our premiumisation strategy and grow our core Spirits business in India,” said Sanjeev Churiwala, Executive Director & Chief Financial Officer, Diageo India.
Total consideration received for this sale is Rs 31.86 crore (US$4.48 million).
USL, which is India’s largest liquor company was acquired by the British multinational alcoholic beverages company, Diageo in 2014 through a US$1.40 billion tender offer.
Diageo has been focusing on premiumising its portfolio and growing its core spirits brands while monetizing core assets.
USL expects the share sale agreement to be completed on 16 January.
Earlier, Grover Zampa said it was in talks to buy the Four Seasons brand together with Charosa brand, owned by Hindustan Construction Company.
This would make its total acquisitions in the wine segment to three, after it bought the Bangalore-headquartered wine brand, Myra Vineyards earlier this month.
Grover Zampa (GZV) has vineyards in Nandi Hills, Karnataka and in Nashik, Maharashtra and is rivalling Sula Vineyards, maker of Chenin blanc, Sauvignon blanc, Riesling and Zinfandel grape varietals in the segment.