Indian liquor company United Spirits Ltd has sold Bengaluru-based subsidiary Four Seasons Wines Ltd to Grover Zampa Vineyards Ltd and its investor Quintela Assets Ltd.
United Spirits, a unit of British spirits maker Diageo Plc, sold the wine subsidiary for Rs 31.86 crore ($4.5 million), it said in a stock-exchange filing.
“This deal brings us a step closer to the structural rationalisation and simplification of our India business,” said Sanjeev Churiwala, executive director at Diageo India.
Four Seasons Wines was established in 2006. It produces red, white and rose wines from grapes grown around Sahyadri valley in Maharashtra under the Zinzi and Four Seasons brands.
Churiwala said the wine business is a niche area but a small part of the overall Diageo India portfolio and that the sale will enable the company to grow its core business in India.
United Spirits, formerly part of businessman Vijay Mallya’s liquor empire, is India’s top alcoholic-beverage company. It makes, sells and distributes brands such as Johnnie Walker, Black Dog, Black & White, VAT 69, Antiquity, Signature, Royal Challenge and McDowell’s No.1. Headquartered in Bengaluru, United Spirits has over 5,000 employees and 60 manufacturing facilities.
Grover Zampa is India’s second-largest wine maker, after Sula Vineyards. The company was set up in 1988 by Kanwal Grover. It was initially known as Grover Vineyards before merging with Nashik-based winery Vallée de Vin in 2012 to form Grover Zampa.
The wine maker is backed by Singapore-based investor Ravi Viswanathan, Reliance Capital, AVT Group and Quintela. In October last year, Grover Zampa raised Rs 60 crore in a funding round led by Viswanathan.
Apart from Sula and Grover Zampa, other companies in the wine segment include Fratelli Wines, York Wines, John Distilleries Pvt. Ltd and Diageo’s global rival Pernod Ricard. Some of these companies, and a few others in the broader alcoholic beverages segment, have raised funding in the past.
Earlier this month, US-based spirits maker Sazerac Company bought out mid-market private equity firm Gaja Capital from John Distilleries.
In October, Belgian family-owned consumer-focussed investment company Verlinvest increased its stake in Sula Vineyards in a deal that also saw an American family office come as a new investor.
In July, IIFL Asset Management Ltd invested in craft beer maker White Owl Brewery Pvt Ltd, marking the mid-market private equity firm’s debut deal in the alcoholic beverages segment.
Venture capital firms Saama Capital and DSG Consumer Partners last year backed craft beer maker Goa Brewcrafts Pvt. Ltd. This was the second bet by Saama Capital on an alcoholic beverage company; it had previously invested in Sula Vineyards.
In May, B9 Beverages Pvt. Ltd, which makes craft beer under the brand Bira 91, raised Rs 335 crore in a round led by Belgium-based investment firm Sofina.