B9 Beverages Ltd, the parent company of popular craft beer brand Bira 91, finds itself at the center of a legal storm as it grapples with severe financial challenges. The company is currently engaged in a high-stakes dispute over the control of its profitable Beer Café chain, adding to its mounting troubles.

Legal Battle Over Beer Café Chain

B9 Beverages is locked in a legal tussle with Japanese brewer Kirin Holdings and lender Anicut Capital over the control of BTB, which operates the Beer Café chain. This chain, consisting of 42 outlets and boasting an estimated turnover of ₹100 crore, was one of the few profitable ventures in B9's portfolio.

The company alleges that Kirin Holdings and Anicut Capital have taken control of BTB through what it claims to be a breach of contract and illegal lender action. In response, B9 has moved the Delhi High Court against Anicut Capital. The court has issued an interim order restraining Anicut from selling or creating third-party interests in BTB's shares, highlighting the gravity of the situation.

Financial Turmoil

The legal dispute comes at a time when B9 Beverages is facing significant financial distress. The company's financial health has deteriorated markedly:

This financial downturn has led to a cascade of operational issues:

1. Payment Delays: The company is struggling to make timely payments to distributors and vendors.
2. Employee Unrest: Over 250 staff members have petitioned for the removal of CEO Ankur Jain, indicating internal discord.
3. Fundraising Challenges: B9's efforts to raise capital have hit a roadblock, with BlackRock reportedly withdrawing from potential investment talks.

Shift in Fundraising Strategy

In light of these challenges, B9 Beverages appears to be pivoting its fundraising strategy. The company is now focusing on securing domestic funding, moving away from its previous emphasis on international investors.

This shift comes at a critical time for the company as it seeks to navigate through its current financial and legal challenges. The outcome of the ongoing legal dispute and the success of its new fundraising efforts will likely play crucial roles in determining the future trajectory of B9 Beverages and its popular Bira 91 brand.

As the situation continues to unfold, stakeholders will be closely watching how B9 Beverages manages these multiple challenges and whether it can regain its financial footing in the competitive craft beer market.

In a significant development for the Indian craft beer industry, Kirin Holdings and Anicut Capital have reportedly taken control of Beer Café, the retail arm of popular craft beer maker Bira 91. This move has sparked a legal dispute between B9 Beverages, Bira 91's parent company, and its lenders.

Key Points of the Takeover

• Beer Café operates under Better Than Before (BTB), a subsidiary of B9 Beverages.
• BTB is considered one of B9 Beverages' profitable verticals, generating close to ₹100 crore in turnover.
• The takeover by Kirin Holdings and Anicut Capital is evidenced by regulatory filings.

Legal Challenges

The transaction has not been smooth, leading to a dispute between B9 Beverages and its lenders:

• B9 Beverages has challenged Anicut Capital's actions in the Delhi High Court.
• An interim order was issued on October 17, restricting Anicut from selling or creating third-party interests in BTB shares.

Conflicting Claims

There are conflicting statements regarding the ownership status of BTB:

1. Lenders' Position: Kirin Holdings and Anicut Capital claim to have taken control of Beer Café.
2. B9 Beverages' Stance: Bira 91 CEO Ankur Jain maintains that BTB remains a wholly owned subsidiary of B9 Beverages.

Jain alleges that the lenders' actions violate existing contracts, adding another layer of complexity to the situation.

Implications for Bira 91

This development could have significant implications for Bira 91, a rising star in India's craft beer market:

• Potential loss of a profitable retail arm
• Ongoing legal battles may impact the company's operations and reputation
• Uncertainty over the future structure and ownership of Beer Café

As the legal proceedings unfold, the outcome of this dispute will be closely watched by industry observers and could set precedents for similar cases in the future. The situation underscores the complex relationships between rapidly growing startups, their subsidiaries, and financial backers in India's evolving business landscape.