United Spirits Ltd, part of global spirits major Diageo, has exited from start-up liquor delivery firm, Hip Bar Pvt Ltd.
The board of USL had last week approved “sale of all equity shares and CCPS (Compulsory Convertible Preference Shares)” held by it in Hip Bar Pvt Ltd, which owns the HipBar app that provides a digital ecosystem for age-verified delivery model of liquors.
The company’s board had approved sales of the equity shares and CCPS to HipBar founder and CEO Prasanna Natarajan for consideration of Rs 52 lakh, USL said in a regulatory filing.
“Upon completion of the above sale, HipBar will cease to be an associate company of USL,” the company said.
USL said it had fully impaired its investment in HipBar in 2020-2021.
“Consequently, the proposed divestment will not have any adverse effect on company’s performance in the current financial year,” it added.
Hip Bar Pvt Ltd had a turnover of Rs 50 lakh in the financial year ended March 31, 2020 and its net worth was Rs 7.76 crore.
In June 2018, USL had picked up 26 per cent stake in the liquor delivery start-up HipBar for Rs 27 crore.
At that point of time, USL had bet on the fast growing e-commerce industry, which was “making an impact on just about every industry imaginable” and had earmarked the beverage alcohol industry “to be the next sector to be disrupted by the continued shift to digital”.
While cities like Mumbai and Kolkata have already allowed doorstep delivery of alcohol, it is yet to gain momentum in other parts such as Delhi due to regulatory issues.