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.

In a significant development for the Indian craft beer industry, B9 Beverages, the parent company of popular brand Bira 91, is facing a severe leadership crisis. Large institutional investors, including Kirin Holdings and Peak XV Partners, are reportedly in discussions to remove founder and CEO Ankur Jain from his position. This move comes in the wake of mounting losses and growing concerns over the company's governance.

The Catalyst: A Costly Name Change

The crisis at Bira 91 stems from a corporate name change initiated in late 2023. This seemingly routine administrative action had far-reaching consequences:

• The company was forced to reapply for licenses across all states where it operates.
• Sales came to a halt during this process.
• Approximately ₹80 crore worth of inventory became unsellable.

Financial Repercussions

The impact of this error on the company's financials has been severe:

Employee Unrest and Operational Challenges

The company's troubles have extended beyond its balance sheet:

• Over 250 employees have petitioned for Jain's removal.
• Unpaid salaries amount to approximately ₹50 crore.
• Vendor payments have defaulted.
• The workforce has been cut by more than half.
• Previously planned IPO has been shelved after BlackRock withdrew its participation.

Fundraising Efforts

In an attempt to address its financial woes, Bira 91 is:

• In advanced talks to raise $132 million from Global Emerging Markets group.
• Aiming to use these funds to clear dues and restart operations.

Management's Response

Despite the mounting pressure, Ankur Jain has defended his leadership. He stated that his focus remains on:

1. Completing the ongoing fundraising efforts.
2. Protecting the interests of the company's employees.

This situation at Bira 91 highlights the critical importance of careful corporate governance and the potential consequences of administrative oversights in the competitive craft beer industry. As the company navigates through this challenging period, the outcome of the leadership discussions and fundraising efforts will be crucial in determining its future trajectory.