India: India's biggest brewer, UB Group bid 3 billion rupees ($69 million) on Tuesday, February 22, for 25 % of Shaw Wallace & Co. Ltd., a diversified group that makes leading Indian liquor brands, according to Reuters. UB Group's bid of 250 rupees per share represents an 8.2 % premium over Shaw's Tuesday close. A source close to the deal had told Reuters earlier in the day that UB was expected to bid 250 rupees per share for at least 20 percent of Shaw.

Vijay Mallya-controlled UB Group owns brands such as Kingfisher, while Shaw Wallace's liquor brands include Royal Challenge and Director's Special.

Shaw Wallace, which also makes gelatines and agrochemicals, has been examining bids for its liquor business. Media reports last month had said UB was ahead with a bid of 12 billion rupees. "We had already bid for the spirits business and emerged the the highest bidder," Mallya, chairman of the UB Group, told reporters in a conference call.

The Chabbria family, which controls Shaw Wallace, later changed the structure of the deal and decided to sell a 55 percent stake in the parent company rather than sell the spirits business separately. "I would like to emphasise that our decision to bid for 25 percent of the shares of Shaw Wallace is one step closer to our desire to acquire to acquire the 55 percent from the Chabbria family," said Mallya, who is also a member of the upper of house of India's parliament.

The UB Group currently owns no shares of Shaw Wallace. Under the Indian takeover law, Mallya would now have to make an open offer for acquiring at least another 20 percent in Shaw Wallace at 250 rupees.

Prior to the news, shares in United Breweries Ltd. had closed 1 percent lower at 421 rupees, valuing the UB Group subsidiary at $170 million. Shaw Wallace closed flat at 231.05 rupees.

In December, Britain's biggest brewer, Scottish and Newcastle Plc., agreed to buy 37.5 percent in United Breweries for 4.6 billion rupees. ($1=43.7 Indian rupees)

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