Varun Beverages Limited (VBL), a key player in the beverage industry, has announced plans to invest in renewable energy to power its operations in Rajasthan. The company's Investment and Borrowing Committee has approved the acquisition of up to 26% stake in Jager Renewables Two Private Limited, a move aimed at securing a sustainable and cost-effective power supply for its facilities in the state.

Strategic Investment in Solar Power

Jager Renewables Two Private Limited, incorporated on June 6, 2024, is a special purpose vehicle (SPV) established under the group captive model outlined in the Electricity Act, 2003. The company's primary focus is to generate and supply solar power to consumers in Rajasthan. This strategic investment aligns with Varun Beverages' commitment to environmental sustainability and operational efficiency.

Scope of the Acquisition

The acquisition details include:

• VBL will invest in one or more tranches, with an initial investment of Rs. 26,000 in equity shares.
• The company will acquire 2,600 equity shares with a face value of Rs. 10 each.
• Upon completion, VBL will hold up to 26% of the equity share capital in Jager Renewables Two.

Benefits and Impact

This move is expected to bring several advantages to Varun Beverages:

1. Environmental Sustainability: By investing in solar power, VBL demonstrates its commitment to reducing its carbon footprint.
2. Cost Reduction: The company anticipates a decrease in power costs at its Rajasthan facilities.
3. Operational Efficiency: Solar power will be supplied to VBL's facilities in Kota, Alwar, Jaipur, Jodhpur, and Bhiwadi.

Timeline and Regulatory Compliance

• The transaction is expected to be completed on or before June 2, 2026.
• No specific governmental or regulatory approvals are required for this acquisition.
• The investment does not fall under related party transactions, as confirmed by VBL.

Conclusion

This strategic move by Varun Beverages showcases the company's proactive approach to sustainable business practices and operational optimization. By investing in renewable energy, VBL is positioning itself to meet its power needs more efficiently while contributing to the growth of India's clean energy sector.

The company's decision to disclose this information promptly, in compliance with SEBI regulations, underscores its commitment to transparency and good corporate governance practices.

Varun Beverages Limited, a key player in the beverage industry, has taken a significant step to support its international operations. The company has issued a corporate guarantee of USD 22.00 million for its subsidiary, Varun Beverages (Zimbabwe) (Private) Limited.

Guarantee Details

The corporate guarantee, valid until June 30, 2028, has been issued in favor of ICICI Bank Limited, United Arab Emirates. This financial move is designed to secure a credit facility extended by the bank to the Zimbabwe subsidiary, potentially bolstering its operational capabilities in the African market.

Transaction Transparency

Varun Beverages has emphasized the transparency of this transaction, stating that the company's promoters and group companies have no interest in this deal. The company has explicitly mentioned that the guarantee has been provided at arm's length, adhering to standard business practices and regulations.

Financial Implications

According to the company's disclosure, there is no immediate impact of this corporate guarantee on the listed entity, Varun Beverages Limited. This suggests that the guarantee is part of the company's strategic financial management to support its international subsidiary without affecting its own financial position significantly.

Regulatory Compliance

The issuance of this corporate guarantee was reported to the National Stock Exchange of India Ltd. and BSE Limited, in compliance with Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. This prompt disclosure aligns with the company's commitment to transparency and regulatory adherence.

Conclusion

This move by Varun Beverages Limited demonstrates the company's ongoing support for its international operations, particularly in the African market. By providing this substantial guarantee, the company is potentially enabling its Zimbabwe subsidiary to access necessary credit facilities, which could contribute to its growth and operational efficiency in the region.