NYSE-listed Molson Coors Brewing Company, the world’s fifth largest brewing company, has acquired a controlling stake in Lord Karan Billimoria-owned Cobra India. The new joint venture will brew and market Cobra beer in South Asia.

Molson Coors, with revenues of topping $3 billion, will make a total investment of $35 million in Cobra India as a part of this transaction for the stake buy, besides the expansion of brewery operations and working capital expenditure.

“Molson Coors will purchase a controlling stake of Cobra India from two existing investors and will have operational control over the new Molson Coors Cobra India,” the company said a statement. Last year, an investor group including New York-based private equity firm Brahma Management and Krrish Infrastructure, had acquired 50 per cent stake in Cobra India for around $12 million.

The deal comes after Molson Coors UK and Cobra Beer established a similar joint venture in 2009, the Cobra Beer Partnership Ltd, which has the world rights for the iconic beer outside of South Asia.

Billimoria started selling Cobra beer in 1990 in the curry houses of Great Britain. It was initially brewed in India and later got a licence for Britain in 1997. Cobra UK also roped in the hedge fund Och-Ziff Capital Management as an investor and was eventually sold to Molson Coors in May, 2009.

The JV, which will be named Molson Coors Cobra India, will be chaired by Billimoria, who is also the chairman of the Cobra Beer Partnership in the UK. The deal includes land and a 175,000 hectolitre brewery in Bihar, which can be expanded to 500,000 hectolitre.

Cobra India sells beers like Cobra Premium, King Cobra Superior and Iceberg 9000. Molson’s brands include Coors Light, Molson Canadian, Carling, Blue Moon and Keystone.

The Mumbai-headquartered joint venture will be led by its president Ravi Kaza, and the management team will also include Dr S. Cariapa, the original brewer of Cobra Beer.

The Indian beer market is growing at 12 per cent CAGR and is estimated to grow to 50 million hectolitre by 2020, putting it among the top 10 beer markets globally.

“This deal marks the beginning of a long-term commitment to establish Molson Coors in India, the world’s fastest growing beer market. Our first step will be to work with Cobra India’s employees, customers and suppliers to consolidate the business. Longer-term, our ambition is to build this compelling brand and grow the business to a meaningful market share as part of Molson Coors International’s strategy to achieve critical mass in high-growth emerging markets,” said Kandy Anand, president of Molson Coors International.

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