EMPERADOR Inc., the liquor unit of businessman Andrew Tan, said it secured a £210-million (around $338.27 million) debt from two international banks, proceeds of which will be used for its general corporate purposes.
The company said in its notes to its bondholders that its unit Emperador International Ltd. (EIL) signed on September 30 the agreement between lenders Hongkong and Shanghai Banking Corp. Ltd., Hong Kong branch, and JPMorgan Chase Bank, Singapore branch. Emperador and Emperador Distillers Inc. both gave their guarantees for the loan.
“The loan was fully availed today by EIL with a tenure of one year and interest pegged at a margin of 1.25 percent per annum over Libor.
“The loan shall be used for general corporate purposes related to the core business of beverage,” Emperador said. As a result of the deal, Alliance Global Group Inc., Tan’s holding firm, gave an additional guarantee on Emperador Inc.’s $500-million notes, which carry a 6.5-percent interest rate, maturing in 2017.
The distiller, famous for its namesake brand of brandy, earlier said it will raise some 70 percent of its £430-million acquisition price of White and Mackay, the world’s fifth-largest whiskey manufacturer.
Kingson Sian, president of Emperador’s parent, AGI, said the deal, which will catapult Emperador as one of the world’s top liquor manufacturers, only awaits approval from the Reserve Bank of India, the country’s central bank, as the sale will result in significant writeoff of loans recoverable by United Spirits, the previous owner of Whyte and Mackay. Sian said Emperador will develop White and Mackay’s Asian market, where it has little presence, by partnering with local distributors, while strengthening its European market, where Tan’s liquor firm, in turn, has little market previous to the acquisition.
Winston Co, Emperador president, earlier said that despite market lead in the brandy segment in the Philippines, the company plans on further developing the market by introducing the brands of Whyte and Mackay, such as the blended scotch whiskey and single malt.
“There’s no whiskey in the Philippines, yet. But we think that our company can develop a whiskey culture in the Philippines, which today is absent. We believe that this acquisition of Whyte and Mackay will pave the way for us to introduce a world-class portfolio of whiskey,” Co said.
He said the company will start introducing imported whiskey brands by next year as it will employ the same strategy it used 25 years ago when it introduced Emperador to the Philippine market.
“You need someone to actually develop that [whiskey market], and we are pioneering that effort. We will be the first mover in the whiskey space.
“We believe that eventually we will own both the brandy and the whiskey segment,” Co said, adding that it still sees growth for its brandy segment in the coming years.
He said the whiskey market will be a totally different segment, with price points of about P150 to P300 per bottle.
VG Cabuag