Shaw Wallace

Shaw Wallace, formally Shaw Wallace & Company Limited and commonly abbreviated as SWC, was an Indian company established in 1886 by Robert Gordon Shaw and Charles William Wallace. Headquartered at Wallace House in Kolkata, West Bengal, it became associated primarily with the manufacture and sale of Indian Made Foreign Liquor (IMFL), although its historical activities were more diversified. The company developed a substantial position in India's packaged alcoholic-beverage market and was particularly known for the Royal Challenge and Director's Special whisky brands. The business began as a broad-based commercial enterprise rather than as a narrowly focused spirits company. Before the restructuring of its operations in the late 1990s, Shaw Wallace was involved in several lines of business. As part of a plan to concentrate its activities, it sold Calcutta Chemicals Limited and Detergents India Limited to Henkel SPIC in 1999. This divestment reflected a wider shift away from unrelated consumer and industrial activities and toward beverages, especially liquor and brewing. Ownership and control changed substantially in the early 2000s. After the death of businessman Manu Chhabria, United Breweries Group increased its ownership of Shaw Wallace to 54.54 percent on 21 March 2005. The transaction was approved by Chhabria's widow, Vidya Chhabria. The change brought Shaw Wallace into the orbit of the UB Group, one of India's major beverage groups, and set the stage for the subsequent separation of its spirits and beer interests. In the middle of 2005, the spirits business was acquired by the United Breweries Group, while the company's breweries and beer operations were acquired by SABMiller. This division meant that different parts of the former Shaw Wallace portfolio moved to different owners. The Royal Challenge beer business, which was concentrated particularly in Andhra Pradesh, became associated with SABMiller, while the principal spirits operations were aligned with the UB Group. Shaw Wallace also had a connection with consumer electronics distribution: its electronics arm handled distribution of Sega Mega Drive consoles in India. Sega entered the arrangement in 1994, and Shaw Wallace began manufacturing consoles domestically from 1995 in an effort to avoid India's high import tariff. The Sega distribution business was subsequently transferred to Maze Marketing in 1995. For the financial year 2006–07, the company reported net sales of Rs 1,388.5 million, compared with Rs 1,155.2 million in 2005–06. Total income was reported at Rs 2,321.5 million, down from Rs 2,933.8 million in the preceding year, while profit after tax rose to Rs 820.7 million from Rs 468.6 million. These figures belong to the pre-merger company and are included as historical context rather than as current financial information. Merger discussions between Shaw Wallace and United Spirits developed in 2007. Director S. R. Gupte said on 29 September 2007 that talks would soon begin, and the Shaw Wallace board subsequently approved the merger proposal. On 1 April 2008, Shaw Wallace was merged with United Spirits Limited, a UB Group subsidiary. The merger ended Shaw Wallace as a separate corporate entity, although several of its beverage brands and business legacies continued through successor companies and their portfolios.

Shaw Wallace & Company Limited was founded in 1886 by Robert Gordon Shaw and Charles William Wallace. The company was based at Wallace House in Kolkata and initially operated as a diversified commercial enterprise. Its later identity was shaped by the Indian alcoholic-beverage industry, particularly the production and sale of Indian Made Foreign Liquor. The company undertook a restructuring program before the end of the 1990s. In 1999, it sold Calcutta Chemicals Limited and Detergents India Limited to Henkel SPIC, reducing its exposure to non-beverage businesses. It subsequently concentrated more heavily on spirits and brewing. Its best-known whisky brands became Royal Challenge and Director's Special, while the company also maintained brewery and beer interests. The ownership structure changed after the death of businessman Manu Chhabria. On 21 March 2005, United Breweries Group increased its stake in Shaw Wallace to 54.54 percent, with the transaction approved by Chhabria's widow, Vidya Chhabria. During the middle of that year, the company's operations were divided by business line: United Breweries Group acquired the spirits business, while SABMiller acquired the breweries and beer business. Royal Challenge beer, which was especially associated with the Andhra Pradesh market, moved with the beer operations. Shaw Wallace also had a short-lived role in India's consumer-electronics distribution sector. Its electronics division distributed Sega Mega Drive consoles in India from an arrangement that began in 1994. Domestic manufacturing began in 1995, partly because India's 80 percent import tariff made imported consoles expensive. The Sega distribution activity was transferred to Maze Marketing in 1995. The remaining corporate entity continued to report financial results before its eventual merger. In 2006–07, it reported net sales of Rs 1,388.5 million and profit after tax of Rs 820.7 million. Merger discussions with United Spirits were publicly indicated in September 2007, and the Shaw Wallace board approved the proposal. The merger took effect on 1 April 2008, when Shaw Wallace was absorbed into United Spirits Limited, a UB Group subsidiary. This ended Shaw Wallace as an independent company, while the brands and assets associated with its beverage businesses continued under successor ownership.

• 2008

  Merged into United Spirits

  [1]Shaw Wallaceen.wikipedia.org

  Shaw Wallace merged with United Spirits Limited on 1 April 2008 and ceased to exist as a separate corporate entity.

• 2007

  Merger discussions with United Spirits announced

  [1]Shaw Wallaceen.wikipedia.org

  Director S. R. Gupte said merger talks with United Spirits would soon begin; the Shaw Wallace board later approved the merger proposal.

• 2005

  United Breweries Group takes majority ownership

  [1]Shaw Wallaceen.wikipedia.org

  United Breweries Group increased its ownership of Shaw Wallace to 54.54 percent.

• 2005

  Spirits and beer operations change ownership

  [1]Shaw Wallaceen.wikipedia.org

  United Breweries Group acquired the spirits business, while SABMiller acquired the brewery and beer operations.

• 1999

  Chemicals and detergents businesses divested

  [1]Shaw Wallaceen.wikipedia.org

  Calcutta Chemicals Limited and Detergents India Limited were sold to Henkel SPIC as part of the company's restructuring.

• 1995

  Domestic Mega Drive manufacturing and transfer of distribution

  [1]Shaw Wallaceen.wikipedia.org

  Shaw Wallace started manufacturing Sega consoles in India to reduce the impact of import tariffs; the Sega distribution business was later acquired by Maze Marketing in the same year.

• 1994

  Sega distribution arrangement begins

  [1]Shaw Wallaceen.wikipedia.org

  Shaw Wallace began handling distribution of Sega Mega Drive products in India.

• 1886

  Company established

  [1]Shaw Wallaceen.wikipedia.org

  Robert Gordon Shaw and Charles William Wallace established Shaw Wallace & Company Limited in India.

Historically positioned as a diversified Indian beverage company, with its strongest market identity built around mass-market and established whisky brands in the Indian Made Foreign Liquor segment.

• Indian Made Foreign Liquor whisky

  Royal Challenge whisky

  Royal Challenge whisky was one of Shaw Wallace's two principal spirits brands. It represented the company's presence in India's packaged whisky market and remained among the most recognizable offerings associated with the former company.

• Indian Made Foreign Liquor whisky

  Director's Special whisky

  Director's Special whisky was a major Shaw Wallace spirits brand. It formed part of the company's core IMFL portfolio before the spirits business moved into the United Breweries Group structure.

• Beer

  Royal Challenge beer

  Royal Challenge beer was associated with Shaw Wallace's brewing and beer business and was especially sold in Andhra Pradesh. The beer operations, including this business, were acquired by SABMiller in 2005.

• Consumer electronics distribution · 1994

  Sega Mega Drive distribution

  Through Shaw Wallace Electronics, the company distributed Sega Mega Drive consoles in India. It began domestic manufacturing in 1995 in response to high import tariffs, but the distribution activity was transferred to Maze Marketing during the same year.

• 2008

  Merger into United SpiritsM&A

  Background

  After merger discussions announced in 2007, the Shaw Wallace board approved a transaction with United Spirits.

  Action taken

  Shaw Wallace was merged with United Spirits Limited on 1 April 2008.

  Aftermath

  The company ceased to operate as a separate corporate entity, while its beverage brands and business assets continued under successor ownership.

  Source

• 2005

  Change in ownership and separation of business linesM&A

  Background

  United Breweries Group increased its ownership after the death of Manu Chhabria, while the company's spirits and beer activities were subsequently treated as separate acquisition businesses.

  Action taken

  United Breweries Group acquired the spirits business and SABMiller acquired the breweries and beer business.

  Aftermath

  The Shaw Wallace portfolio was divided between two major beverage companies, with Royal Challenge beer moving with the beer operations.

  Source

• 1999

  Divestment of non-core businessesStrategy

  Background

  Shaw Wallace was restructuring its diversified operations and moving toward a more focused business portfolio.

  Action taken

  The company sold Calcutta Chemicals Limited and Detergents India Limited to Henkel SPIC.

  Aftermath

  The divestments reduced the company's exposure to chemicals and detergents and supported its subsequent concentration on beverages.

  Source

1. 1Shaw Wallaceen.wikipedia.org