Last Updated: Wednesday, 16 May 2007
Whisky giant sold to billionaire http://news.bbc.co.uk/2/hi/uk_news/scotland/6659779.stm
[Mr Mallya's United Breweries Group confirmed the purchase]
An Indian billionaire has bought the Scottish whisky distiller Whyte & Mackay in a £595m ($1.2bn) deal.
The spirits giant United Breweries, which is headed by Vijay Mallya, announced the all-cash acquisition to the Bombay Stock Exchange.
In a statement, the firms said the deal would help expand the market for Whyte & Mackay's brands in emerging economies such as India.
It will also help UB Group add Scotch whisky to its portfolio of products.
United Spirits, part of the UB Group of companies, said it planned to introduce Whyte & Mackay's brands to the Indian market immediately.
Mr Mallya, who has been dubbed India's Sir Richard Branson after he took his Kingfisher beer brand into airlines, will become chairman and chief executive of the firm.
Speaking at a conference in Glasgow on Wednesday, he said: "Until today, the only missing link in our portfolio has been Scotch and, due to the shortage and rapidly increasing prices of Scotch whisky, we needed a reliable supply source.
[In Whyte & MacKay we not only have a strong place in the Scotch whisky business but of course a great heritage of brands
Vijay Mallya New Whyte & MacKay owner]
"In Whyte & MacKay we not only have a strong place in the Scotch whisky business, grain and more distillation, but of course a great heritage of brands."
The tycoon also made assurances that jobs at the company were safe with expansion more likely than any cuts.
He also said he had an emotional attachment to the firm, with its Jura whisky being his late father's favourite single malt.
Vivian Immerman and his brother-in-law, Robert Tchenguiz, had taken full control of Glasgow-based Whyte & Mackay two years ago.
Mr Immerman had been part of a group of investors who paid £208m for the company in 2001.
He said he was selling the company because it would be "very difficult" for him to take it to the next level.
Mr Immerman told BBC Scotland: "Vijay will bring the international distribution, especially in the emerging markets where Scotch has exponential growth which has not been seen over the last several decades, and that is vital for this business."
[Whyte & MacKay owns the Dalmore distillery in the Highlands]
He said all the existing staff would be transferring over to the new owner and dismissed suggestions that any of the company's brands could be distilled in India.
"Scotch whisky can only be made in Scotland," he stressed.
Whyte & Mackay's self-branded whisky holds about 3% of the UK whisky market.
The company, which employs more than 500 staff on sites around Scotland, also owns the Dalmore and Jura brands as well as Vladivar vodka and Glayva liqueur.
UB Group dominates the Indian spirits market, which is the world's largest for whisky.
But Scotch whisky only makes up about 1% of the Indian market, as a result of tariffs imposed by the country's national and state governments.
Mr Mallya has been criticised by the spirits industry for trying to sell cheap Indian whisky in Europe.
The Scotch Whisky Association (SWA) has in the past argued that UB's Indian-made product was not whisky as it was distilled with molasses rather than malt.
But following the deal, an SWA spokesman said: "This announcement again shows that Scotch whisky has a global appeal and that international confidence in the Scotch whisky industry's future prospects is strong."