INDIA: Radico Khaitan to seek foreign funds for IMFL subsidiary
The company is seeking foreign investment for its IMFL business
Spirits producer Radico Khaitan is preparing to spin off its Indian Made Foreign Liquor (IMFL) business as a subsidiary and seek foreign investment in the unit.
In a statement to the Bombay Stock Exchange on Monday (21 October), the company said its board has approved the disposal of its IMFL business to a subsidiary, subject to shareholder approval.
Speaking to the Times of India, Radico Khaitan's MD, Abhishek Khaitan, was cited as saying: "We have been approached by multiple strategic investors to be part of our IMFL business. We have decided to take an enabling resolution for demerger of the IMFL portfolio into a subsidiary of Radico Khaitan, where we would bring in a foreign partner to enhance the shareholder value."
The report claims that Japan's Suntory Holdings is the frontrunner to invest and is expected to pick up a 50% stake in the unit.
Radico Khaitan, which is India's fourth largest spirits firm, already has a tie to Suntory as the group markets and distributes the Japanese firm's brands in India.
However, the Indian firm reportedly said that no company has yet to make a formal offer of investment.
Radico Khaitan, which started producing IMFL in 1998, has four million-case brands: 8PM Whisky, Contessa Rum, Old Admiral Brandy and Magic Moments Vodka.
*This article has been updated from the original version which appeared yesterday (22 October).
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