Bira maker faces fresh scrutiny as Kirin, lenders discuss management and strategy reset

Bira last raised $25 million in June 2024 through external commercial borrowings from Kirin

Japan's Kirin Holdings, a major shareholder in B9 Beverages-the company behind Bira 91-has begun joint discussions with other stakeholders and creditors to overhaul the beer maker's management, governance structure and business strategy as it faces a funding crunch and employee unrest, The Mint reported.

A Kirin spokesperson told The Mint in an emailed response that the company is aware of the current management situation at B9 Beverages and is engaged in collaborative talks with shareholders and lenders on a potential restructuring plan. The spokesperson clarified that Kirin has no intention of exiting its investment or selling its stake.

As per The Mint, the proposed restructuring aims to help B9 navigate its financial challenges and support the scaling of the Bira91 brand. Kirin's broader global strategy-particularly its expansion in the alcoholic beverages category-is not directly tied to the developments at B9, the spokesperson added. Kirin has diversified interests across alcoholic drinks, non-alcoholic beverages and pharmaceuticals.

Institutional investors together hold the largest stake in B9 Beverages at 28.6%, led by Peak XV (formerly Sequoia India), along with Sofina, Sixth Sense, MUFG Bank, Tiger Pacific, Mayfield and GHIQF Mauritius, The Mint reported. Kirin owns 20.3% of the company. Bira last raised $25 million in June 2024 through external commercial borrowings from Kirin.

In October, The Mint reported that several major institutional shareholders were evaluating the removal of CEO and founder Ankur Jain due to concerns over his handling of the financially stressed company. Investors are willing to infuse additional capital if Jain steps down, according to people familiar with the matter cited by The Mint. Lenders and investors are preparing to formally request an extraordinary general meeting (EGM) to push this process forward.

One lender told The Mint, on condition of anonymity, that a requisition for the EGM would be sent once all major shareholders sign off, adding that a restructuring plan involving changes to shareholding and partial debt-to-equity conversion is contingent on Jain's resignation.

Under company law, shareholders holding at least 10% voting power can seek an EGM, which the board must call within 21 days of receiving a valid request and conduct within 45 days, The Mint noted. Jain has not responded to The Mint's requests for comment.

The developments follow Kirin and Anicut Capital-B9's largest lender-taking control of The Beer Cafe, previously a subsidiary of B9 Beverages, by invoking pledged shares, filings with the Registrar of Companies showed, as reported by The Mint. B9 has since challenged Anicut Capital's actions in the Delhi High Court, adding a legal dimension to the company's turmoil.

The Mint's reporting highlights that B9 Beverages is grappling with delayed salaries, falling revenue and employee discontent. Its market presence has shrunk to a limited number of states. In recent months, lenders and investors, including Anicut Capital and Hero Enterprises' Sunil Munjal, have invoked shares in B9 and its related entities, reducing the overall promoter stake. While promoters previously held 17.8%, The Mint could not independently verify Jain's current shareholding after recent actions.

A virtual meeting among investors and lenders-including Peak XV, Sofina, Sixth Sense Ventures, Anicut Capital and Kirin Holdings-in September saw broad consensus that fresh capital would be infused only if Jain exited his role, The Mint reported. Meanwhile, several employees have approached the board and investors over delayed salaries and governance concerns.

B9 Beverages has already attempted internal restructuring in the past year by limiting operations to fewer states, cutting fixed costs and prioritising gross margins, according to The Mint.