London Pilsner Breweries has been floated for the purpose of setting up a 1.5 lakh hecta litre brewing facility in one of the southern districts of Goa. The new facility would come up within the next 18 months with an initial investment of Rs 40 crore. ABD currently brews and markets brands like San Miguel, London Pilsner beer, etc.

Confirming the development, ABD director Zinia Lawyer told The Financial Express that talks with San Miguel were on. However, the Phillipines firm has not taken any decision for the purpose. ``We are ready to offer a part of the promoter's stake to San Miguel that does not have a direct presence in the Indian market. However, we will retain a controlling stake in the venture,'' she said.

The company is yet to finalise the equity-debt ratio of the project. London Pilsner would tap the debt market to raise term loans, once the partnership with San Miguel is in place. However, Lawyer maintained that the promoters would not offer any equity stake in Associated Breweries & Distilleries to strategic investors. ``We will continue as a family-run, closely-held firm in the years to come,'' she added.

Incidentally, ABD and San Miguel have a licensing agreement to manufacture and distribute San Miguel lager beer in the country. At present, ABD has brewing capacity of 2 lakh hecta litres at its Mumbai facility.

The Rs 40 crore ABD is promoted by three ladies - Mehroo N Irani (chairperson), Zinia Lawyer and Bakhtawar B Chenoy (directors), while the company has a professional team to manage the operations.

According to industry sources, once the deal is finalised with San Miguel, this would be a direct entry of the Philippines company into the country. Beverage is the largest of San Miguel's core businesses, accounting for 60 per cent of consolidated sales. San Miguel's food business accounts for 25 per cent and packaging products cover the balance 15 per cent. In 1997, the company's net income was $94 million.

The company operates five breweries in the Philippines and four breweries in China including Hong Kong. In addition, it has strategic alliances with Coca Cola Company, Nestle, the New Zealand Dairy Board, United Distillers of the UK and Yamamura Glass of Japan.

Started operations in 1975, ABD currently brews and markets seven brands including London Pilsoner, London Diet, London Super Strong 2001 Plus, London Super Strong 5001 Plus, Maharaja Premium Lager, Bulldog and London Draft. The company is also exporting its Maharaja Premium Lager beer to New Zealand, Japan and Australia.