Industry

Binny, Mohan Breweries drop merger plan

Complicated State excise rules and long delay in getting clearances from the authorities concerned have forced Binny to drop its merger proposal with Mohan Breweries and Distilleries Ltd. (MBDL).

A decision to this effect was taken at the Binny’s board meeting here on Thursday. However, Binny decided to go ahead with the merger of its subsidiary Arthos Breweries Ltd. with MBDL.

Talking to The Hindu, Binny Executive Chairman M. Nandagopal said: “We have breweries and distilleries in Tamil Nadu, Seemandhra and Kerala. Each State Government has formulated its own excise rules. Getting clearances from the authorities are a major problem. After the enactment of the new companies law, we have to obtain clearances from several authorities for merger, and it may take more than a year. Hence, we have dropped the merger proposal.”

The earlier plan of moving MBDL’s bottling and brewery plant from Chennai to Kancheepuram was on. Later, the existing factory site would be converted into a township, he added.

He said the company had decided to invest about Rs.500 crore in expanding the capacity of MBDL’s distillery at Chengalpattu and brewery in Seemandhra, besides the new distillery in Seemandhra and doubling the capacity of Arthos brewery in East Godavari.

“We are debt-free. All the capital expenditure will be met through internal accruals and income from the real estate business,” he said.

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Printable version | Feb 27, 2021 9:54:00 AM | https://www.thehindu.com/business/Industry/binny-mohan-breweries-drop-merger-plan/article6705189.ece

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