It is a public offering of a different kind. Eager to be stakeholders in Asia?s largest winery, at least 2,000 grape growers have lined up for picking up shares in Vijay Mallya?s Four Seasons Wines Ltd, a part of the UB group. A first for the wine industry in India, where a large business house has invited equity participation from farmers who would otherwise have just remain suppliers.
?The response has been tremendous. We have been getting enquiries from farmers in Maharashtra and Karnataka. The first meeting with the farmers was encouraging. At least 1,200 farmers sought applications and another 800 applications were taken thereafter. Around 500 farmers have already filled up application forms,? Abhay Kewadkar, business head and chief wine maker, United Spirits Ltd (USL) Wines said. USL owns 51% in Four Seasons.
The amount of shareholding will depend on the landholding. The shares will be distributed between farmers and strategic investors, Kewadkar said. ?For the present, the company has decided to allot 500 shares per acre. The company will look at the minimum holding of the farmer, the soil quality and water availability and competency to grow grapes. After the pre-selection process, the company will enter into a 15-year contract with the farmers,? Kewadkar said.
This year, the company intends to enter into contracts for about 1,000 acre.
At present, the company has existing contracts with farmers for about 500 acre, who will also be invited to pick up shares in the winery, he said. The UB Group has acquired about 50 acre in Baramati and is looking at another 300 acre to set up vineyards.
After the completion of the selection process, the board of directors of Four Seasons will be constituted. The winery has commenced bottling operations on site. In the first year, the company will make around 1.5 million bottles.
?The wine has been tested in different formats and will be commercially launched in a week,? he said. About Rs 100 crore will be invested in this plant over the next five years.