letter of offer - securities and exchange board of india · 2018. 10. 10. · and phipson...

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THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

This document (�Letter of Offer� or �LOF�) is sent to you as equity shareholder(s) of Herbertsons Limited. If you require any

clarification about the action to be taken, you may consult your stockbroker or investment consultant or the Manager / Registrar to

the Counter Offer. In case you have sold the equity shares which are the subject of this LOF, please hand over this LOF and the

accompanying Form of Acceptance cum Acknowledgement (�Form�), transfer deed and Form of Withdrawal to the member of the

stock exchange through whom the said sale was effected.

MCDOWELL & COMPANY LIMITED

Registered Office: 51 Richmond Road, Bangalore � 560025 (Tel: 080 � 227 4452 Fax: 080 � 227 2973)

and PHIPSON DISTILLERY LIMITED

Registered Office: Le Parc Richmonde, 51 Richmond Road, Bangalore � 560025 (Tel: 080 � 221 5415 Fax: 080 � 227 2973)

acting in concert with UNITED BREWERIES (HOLDINGS) LIMITED

Registered Office: UB House, No. 1, Vittal Mallya Road, Bangalore � 560001 (Tel: 080 � 227 2806 Fax: 080 � 212 7212)

MAKE A COUNTER OFFER

AT Rs. 215 PER EQUITY SHARE PAYABLE FULLY IN CASHPursuant to the provisions of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers)

Regulations, 1997 and subsequent amendments thereto (�Regulations�)

TO ACQUIRE

43,00,000 equity shares of Rs.10/- each representing about 45.16% of the outstanding paid-up equity share capital (57.79% of

the Voting Equity Capital)

of HERBERTSONS LIMITED

Registered Office: Ewart House, 22, Homi Modi Street, Mumbai � 400023 (Tel: 022 � 2265 2588 Fax: 022 � 2265 7910)

This Counter Offer is being made as a competitive bid, in accordance with regulation 25(1) and 25(3) of the Regulations, pursuant toan open offer made by K. R. Chhabria, M.D. Chhabria and persons acting in concert. The open offer made by K. R. Chhabria, M.D.Chhabria and persons acting in concert is subject to the Orders of the Hon�ble Supreme Court of India passed/to be passed in respect

of the earlier acquisitions and the proposed acquisitions of the shares of Herbertsons Limited by them.

The procedure for acceptance is set out in Section VIII of this Letter of Offer. A Form and a transfer deed are enclosed together withthis LOF. The Form with all necessary documents should reach the Collection Centres no later than the scheduled times outlined

in para (5) of Section VIII on December 3, 2003.

● The Statutory approvals needed to implement this Counter Offer and the status thereof is set out in Section VI of thisdocument.

● Shareholders who have accepted the Counter Offer by tendering the requisite documents, in terms of the PublicAnnouncement / Letter of Offer, can withdraw the same upto November 29, 2003.

● If there is a competitive bid:

(i) The public offers under all the subsisting bids shall close on the same date.

(ii) As the offer price cannot be revised after November 20, 2003, it would, therefore be in the interest of theshareholders to wait till the commencement of that period to know the final offer price of each bid andtender their acceptance accordingly.

Regulation 26 of the Regulations provides for an upward revision of the offer in respect of the price and the number of sharesto be acquired, and as stated in the PA any such upward revision can be made at any time upto November 20, 2003. Any suchrevision would be informed by way of an announcement in the same newspapers where the public announcement for this CounterOffer appeared. In case of revision, the revised price would be payable by the Acquirers for all the shares tendered validly anytimeduring the offer period.

A copy of the Public Announcement for the Counter Offer and this Letter of Offer (including the Form of Acceptance cum Acknowledgementand Form of Withdrawal) is expected to be available during the period of the offer on SEBI�s web-site, www.sebi.gov.in

Manager to the Counter Offer

Kotak Mahindra Capital Company Limited

Bakhtawar, 229 Nariman Point

Mumbai � 400021

Tel. No.: 022 � 5634 1100 Fax: 022 � 2284 0492

Email: [email protected]

Contact Person: Mr. Ajay Vaidya, Compliance Officer

Registrar to the Counter Offer

Computech Sharecap Limited

147 Mahatma Gandhi Road, 3rd Floor

Opposite Jehangir Art Gallery, Fort

Mumbai � 400023

Tel. No.: 022 � 2267 1824/25/26

Fax: 022 � 2267 0380


Contact Person: Mr. Patrick Butelho/Ms. Shaila Borkar

Investment Banking

Letter of Offer

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Activity Date Day

Date of Public Announcement Sept 10, 2003 Wednesday

Specified Date Sept 12, 2003 Friday

Last date for posting of LOF to shareholders Oct 22, 2003 Wednesday

Counter Offer Opens on Nov 4, 2003 Tuesday

Counter Offer Closes on Dec 3, 2003 Wednesday

Last date for competitive bid Sept 11, 2003 Thursday

Last date for revising the Offer Price / number of shares Nov 20, 2003 Thursday

Last date for withdrawing acceptance of the Counter Offer Nov 29, 2003 Saturday

Last date for communicating acceptance/ rejection, payment of

consideration and dispatch of rejected share certificates Jan 2, 2004 Friday

CONTENTS

Section Page Number

I. Disclaimer Clause ....................................................................................................................................................... 4

II. Details of the Counter Offer .................................................................................................................................... 4

III. Background of the Acquirers And PAC .................................................................................................................... 6

IV. Background of the Target Company ......................................................................................................................... 10

V. Offer Price and Financial Arrangements ................................................................................................................. 14

VI. Statutory Approvals Required for the Counter Offer ............................................................................................ 16

VII. Terms and Conditions of the Counter Offer .......................................................................................................... 16

VIII. Procedure for Acceptance and Settlement .............................................................................................................. 17

IX. Documents for Inspection .......................................................................................................................................... 19

X. Declaration by the Acquirers .................................................................................................................................... 20

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Terms Defined

Acquirers McDowell & Company Limited and Phipson Distillery Limited

Act Companies Act, 1956

Counter Offer This competitive bid by McDowell, Phipson and persons acting in concert, namely, UBHL, to theshareholders of HL to acquire upto 43,00,000 shares representing 45.16% of the outstanding paid-up equity share capital (57.79% of the Voting Equity Capital) of HL and shall have the meaning asascribed thereto under paragraph (1) of Section II of this LOF.

Eligible Persons All the shareholders of Target Company (see definition below), other than the Acquirers and the PAC(see definition below), whose names appear in the register of members on September 12, 2003 andalso those persons who own the Shares (see definition below) any time prior to the closure of theCounter Offer, whether or not they are registered as members

Form Form of Acceptance cum Acknowledgement

HL, Target Company Herbertsons Limited, a company incorporated under the Indian Companies Act, 1913 and having itsregistered office at Ewart House, 22, Homi Modi Street, Mumbai � 400023

IT Act Income-tax Act, 1961

KMCC/ Manager/ Manager Kotak Mahindra Capital Company Limitedto the Counter Offer

LOF Letter of Offer

McDowell McDowell & Company Limited, a company registered under the Companies Act, 1956 and having itsregistered office at 51 Richmond Road, Bangalore � 560025

Offer Price Rs. 215/- (Rupees two hundred and fifteen only), as may be revised subsequently

Offer Size 43,00,000 shares of Herbertsons Limited, representing 45.16% of the outstanding paid-up equityshare capital (57.79% of the Voting Equity Capital) of the Target Company

Original Bid Offer made by Original Bidders to the shareholders of Herbertsons Limited to acquire 19,04,465fully paid up equity shares of Rs. 10/- each of the Target Company (representing 20% of theoutstanding paid-up equity share capital of HL, 25.60% of the Voting Equity Capital) at a price of Rs90.50 per equity share plus interest of Rs 120.24 payable in cash vide their public announcementon August 21, 2003 and subsequent advertisement dated September 12, 2003. The Original Bid issubject to the Orders of the Hon�ble Supreme Court of India passed/to be passed in respect of theearlier acquisitions and the proposed acquisitions of the shares of Herbertsons Limited by theOriginal Bidders.

Original Bidders Mr. K. R. Chhabria and Mr. M. D. Chhabria and persons acting in concert as outlined in paragraph(2) of Section II of this LOF

PA Public Announcements that appeared in connection with this Counter Offer on September 10, 2003and October 16, 2003 in all editions of Financial Express, Janasatta and Loksatta

Phipson Phipson Distillery Limited, a company registered under the Companies Act, 1956 and having itsregistered office at Le Parc Richmonde, 51 Richmond Road, Bangalore � 560025

RBI Reserve Bank of India

Registrar/ Registrar Computech Sharecap Limitedto the Counter Offer

Regulations Securities & Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations,1997 and subsequent amendments thereto.

SAT Securities Appellate Tribunal

SEBI Securities and Exchange Board of India

Share/ Shares Fully paid-up equity share / shares of Rs. 10/- each of Herbertsons Limited

Specified Date September 12, 2003 being the Specified Date as stated in the Public Announcement dated September10, 2003

UBHL / PAC United Breweries (Holdings) Limited, a company registered under the Indian Companies Act, 1913and having its registered office at UB House, No. 1, Vittal Mallya Road, Bangalore � 560001

UB Group of Companies The UB Group of Companies comprises companies promoted by or controlled by UBHL and/or itssubsidiaries and/or Dr. Vijay Mallya, and their affiliates/associates

Voting Equity Capital 74,40,332 Shares of the Target Company with voting rights, computed as the outstanding paid-upequity share capital of 95,22,323 Shares less 20,81,991 shares on which there is a restraint on votingrights as passed by the Hon�ble Bombay High Court as further outlined in paragraph (2) of SectionIV

Note: a) All capitalised terms used in this Letter of Offer but not otherwise defined herein shall have the meanings ascribedthereto in the Regulations.

b) The headings of the sections and subsections of this Letter of Offer are inserted for convenience only.

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I. DISCLAIMER CLAUSE

IT IS TO BE DISTINCTLY UNDERSTOOD THAT FILING OF DRAFT LETTER OF OFFER WITH SEBI SHOULD NOT IN ANY WAY

BE DEEMED OR CONSTRUED THAT THE SAME HAS BEEN CLEARED, VETTED OR APPROVED BY SEBI. THE DRAFT LETTER

OF OFFER HAS BEEN SUBMITTED TO SEBI FOR A LIMITED PURPOSE OF OVERSEEING WHETHER THE DISCLOSURES

CONTAINED THEREIN ARE GENERALLY ADEQUATE AND ARE IN CONFORMITY WITH THE REGULATIONS. THIS REQUIREMENT

IS TO FACILITATE THE SHAREHOLDERS OF HERBERTSONS LIMITED TO TAKE AN INFORMED DECISION WITH REGARD TO

THE OFFER. SEBI DOES NOT TAKE ANY RESPONSIBILITY EITHER FOR FINANCIAL SOUNDNESS OF THE ACQUIRER(S), PACs

OR THE COMPANY WHOSE SHARES/ CONTROL IS PROPOSED TO BE ACQUIRED OR FOR THE CORRECTNESS OF THE

STATEMENTS MADE OR OPINIONS EXPRESSED IN THE LETTER OF OFFER. IT SHOULD ALSO BE CLEARLY UNDERSTOOD

THAT, WHILE ACQUIRER(S) ARE PRIMARILY RESPONSIBLE FOR THE CORRECTNESS, ADEQUACY AND DISCLOSURE OF ALL

RELEVANT INFORMATION IN THIS LETTER OF OFFER, THE MERCHANT BANKER IS EXPECTED TO EXERCISE DUE DILIGENCE

TO ENSURE THAT ACQUIRER(S) DULY DISCHARGES ITS RESPONSIBILITY ADEQUATELY. IN THIS BEHALF, AND TOWARDS

THIS PURPOSE, THE MERCHANT BANKER KOTAK MAHINDRA CAPITAL COMPANY LIMITED, HAS SUBMITTED A DUE

DILIGENCE CERTIFICATE DATED SEPTEMBER 22, 2003 TO SEBI IN ACCORDANCE WITH THE SEBI (SUBSTANTIAL ACQUISITION

OF SHARES AND TAKEOVERS) REGULATIONS, 1997 AND SUBSEQUENT AMENDMENTS THEREOF. THE FILING OF THIS

LETTER OF OFFER DOES NOT, HOWEVER, ABSOLVE THE ACQUIRER(S) FROM THE REQUIREMENTS OF OBTAINING SUCH

STATUTORY CLEARANCES AS MAY BE REQUIRED FOR THE PURPOSE OF THIS OFFER.

II. DETAILS OF THE COUNTER OFFER

(1) The Acquirers are making this offer (�Counter Offer�), (which shall also mean to include all subsequent revisions, if any), to

all shareholders of the Target Company (other than Acquirers and Persons Acting in Concert), to acquire upto 43,00,000 Shares,

representing about 45.16% of the outstanding paid up equity share capital (57.79% of the Voting Equity Capital) of the Target

Company at a price of Rs. 215 (Rupees two hundred and fifteen only) per Share (�Offer Price�), payable in cash. The Shares

to be acquired under this Counter Offer are to be acquired free from all liens, charges and encumbrances and together with

all rights attached thereto, including the rights to all dividends declared and to be declared and any bonus shares to be issued

by the Target Company hereafter as well as the right to subscribe to any rights issue made by the Target Company hereafter.

This Counter Offer is being made in accordance with regulation 25(1) and regulation 25(3) and regulation 11 of the Regulations

and is for consolidation of the holding of the UB group (the promoter group of the Target Company) in the Target Company.

As per the declarations made in accordance with regulation 8 of the Regulations, the UB Group of Companies is the promoter

group of Herbertsons Limited. The Acquirers and PAC are part of the UB Group of Companies.

(2) An announcement for an offer on August 21, 2003 was made by K. R. Chhabria along with M. D. Chhabria and persons acting

in concert, namely, Veneer Investment & Finance Private Limited, Algid Investment & Finance Private Limited, Airedale

Investment & Trading Private Limited, Beethoven Traders Private Limited, Darrel Traders Private Limited, Stingray Traders

Private Limited, IMFA Holdings Private Limited, Mahameru Trading Co. Private Limited and Shirish Finance & Investment Private

Limited to the shareholders of Herbertsons Limited to acquire 19,04,465 fully paid up equity shares of Rs. 10/- each of the Target

Company (representing 20% of the outstanding paid up equity share capital of HL and 25.60% of the Voting Equity Capital) at

a price of Rs 90.50 per equity share plus interest of Rs 120.24 payable in cash. The Original Bid, which has opened on October

17, 2003 has been made on behalf of K. R. Chhabria, M. D. Chhabria and persons acting in concert by M/s Lazard India Limited,

the Managers to the Original Bid. (Source: Public announcement made by Original Bidders dated August 21, 2003, advertisement

dated September 12, 2003 and corrigendum to the public announcement dated September 16, 2003)

(3) It is stated in the public announcement of the Original Bidders on August 21, 2003 that the Original Bid has been made in

compliance with the order passed by the SAT dated August 1, 2003. The Original Bid is subject to the Orders of the Hon�ble

Supreme Court of India passed/to be passed in respect of the earlier acquisitions and the proposed acquisitions of the shares

of Herbertsons Limited by the Original Bidders.

The review petition regarding the aforesaid order filed by UBHL and Dr. Vijay Mallya before SAT was rejected by SAT.

The order of the SAT has been challenged in an appeal filed by United Breweries (Holdings) Limited and Dr. Vijay Mallya in

the Hon�ble Supreme Court being Civil Appeal No. 17807/2003 in which the Hon�ble Supreme Court on hearing on September

8, 2003 passed the following order:

�The first question that is involved in these appeals/special leave petitions, is: When an acquirer acquires shares in violation

of the Act or the regulations rendering the same as void, whether in such a situation he can be directed to disinvest his

shares and/or be directed to cure the defects in acquiring the shares by ex-post facto announcement in terms of the extant

regulations?

The second question that arises, is: Whether these appeals/special leave petitions are maintainable at the instance of the

appellants/petitioners?

The third question that requires consideration, is: Whether those shareholders who have already sold the shares to the

acquirer, can also adequately be directed to be compensated?

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Having heard the learned senior counsel appearing for the parties at length, we are of the view that these questions require

an authoritative pronouncement by this Court. We, accordingly, issue notice returnable on 15th September, 2003.

Ms. Bina Gupta, Adv. accepts notice on behalf of respondents Kishore Rajaram Chabbria and Madanlal Dwarkadas Chabbria.

Learned counsel appearing on their behalf prays for and is allowed three days� time to file counter affidavit. Rejoinder, if

any, may be filed in another three days.

The appellants/petitioners are further directed to serve the respondent - Chairman, Securities Exchange Board of India (SEBI)

dasti by tomorrow. For that purpose, the Registry shall give notice to the learned counsel for the Appellants/Petitioners

today. An affidavit of service may be filed by the next date of hearing. The notice shall indicate that if the SEBI desires it

may file a counter-affidavit within three days of the receipt of copies of appeals/petitions.

In the meantime, the appellants/petitioners herein may participate in competitive bid for the disputed shares as well as

others, without prejudice to the rights and contentions of the parties, which shall be subject to any other or further order(s)

that may be passed on 15th September, 2003.

Civil Appeal Nos. 4810, 4811, 4813 to 4816 of 2002 be also listed on 15th September, 2003 along with these matters.�

On September 15, 2003 the Hon�ble Supreme Court passed the following order:

�List on 17th October, 2003. Till then, order dated 8th September, 2003 of this Court shall continue.�

On October 17, 2003 the Hon�ble Supreme Court adjourned the matter till November 3, 2003.

Since the order of the Hon�ble Supreme Court dated September 8, 2003, SEBI has filed appeals before the Hon�ble Supreme

Court against the orders of the SAT dated August 1, 2003 directing the Original Bidders to make a public announcement. The

appeals are pending before the Hon�ble Supreme Court.

On October 6, 2003, the Original Bidders have lodged two appeals in the Hon�ble Supreme Court registry against the

abovementioned SAT order.

(4) As of the date hereof the shareholding of Acquirers, PAC and deemed PACs (all part of the UB Group of Companies) in HL is

as follows:

# Acquirers Number of Shares* % of Shares % of Voting

Equity Capital

1 McDowell* 73,709 0.77 0.99

2 Phipson 0 0.00 0.00

PAC

3 UBHL 22,46,756 23.59 30.20

Group companies of the Acquirers/PAC

and deemed to be acting in concert^

4 Vittal Investments Private Limited 46,905 0.49 0.63

5 Devi Investments Private Limited 4,052 0.04 0.05

6 TOTAL 23,71,422 24.90 31.87

Shares pending transfer*

7 McDowell* 3,47,400 3.65 4.67

8 TOTAL 27,18,822 28.55 36.54

*McDowell & Company Limited has lodged 347,400 shares (3.65%) with the Target Company for registration of transfer, which

is deferred and pending

^While the group companies of the Acquirers/PAC hold shares of the Target Company and support the Counter Offer, they do

not propose to play an active part in the Counter Offer

(5) None of the Acquirers nor the PAC have been prohibited by SEBI from dealing in securities, in terms of direction issued u/s

11B of the SEBI Act.

(6) Pursuant to the Counter Offer, the Acquirers do not propose to change the Board of Directors of the Target Company. The

following directors are common directors between the Board of Directors of the Target Company and the Board of Directors

of the Acquirers and PAC: Dr. Vijay Mallya, Mr. S.R. Gupte, Mr. N. Srinivasan and Mr. V.K. Rekhi. Among them, Dr. Vijay Mallya

as Chairman of the Target Company has an interest in the Acquirer and has undertaken to act in accordance with regulation

22(9) of the Regulations. In addition, Mrs. Ritu Mallya, a director of the Target Company is related to Dr. Vijay Mallya. The

aforementioned common directors have undertaken to act in accordance with regulation 22(9) of the Regulations.

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(7) The Counter Offer will be made to those equity shareholders of the Target Company whose name(s) appeared in the Register

of Members of the Target Company at the close of business hours on September 12, 2003, being the Specified Date, as required

under the Regulations. Any person holding Shares, including persons holding shares with blank transfer forms, or a transferee

whose Shares are pending transfer with the Target Company, irrespective of the date of purchase, shall be eligible to participate

in this Counter Offer.

(8) This Counter Offer is not subject to any minimum level of acceptances i.e., the Acquirers will acquire all the Shares that are

validly tendered in terms of this Counter Offer, subject to the terms and conditions of this Counter Offer.

(9) Vittal Investments Private Limited and Devi Investments Private Limited (group companies of the Acquirers/PAC and deemed

to be acting in concert) are not eligible to participate in the Counter Offer. There is no formal agreement within the Acquirer s/

PAC with respect to the Counter Offer. It is understood that Phipson would acquire all the Shares accepted in the Counter Offer,

and Phipson has passed Board Resolutions to this effect.

(10) There are no partly paid up equity shares in the Target Company (Source: Annual accounts of the Target Company for the year

ended March 31, 2002).

(11) The Public Announcement (�PA�) for this Counter Offer appeared on September 10, 2003 in all editions of the Financial Express,

Janasatta and Loksatta. This PA is also available at SEBI�s website, www.sebi.gov.in.

(12) The Counter Offer by the Acquirers is a competitive bid and has been made with the intention of consolidating the holding of

the UB Group of Companies, the promoters of the Target Company, in the Target Company.

(13) As of date of this PA, the Acquirers do not have any plans to dispose of or otherwise encumber any assets of the Target Company

in the next two years except in the ordinary course of business. Notwithstanding the immediately preceding sentence, it will

be for the Board of Directors of the Target Company to take appropriate decisions in these matters as per the requirements

and expediency of the business situation and in line with the opportunities from time to time; provided that Acquirers shall not

sell, dispose of or otherwise encumber any substantial assets of the Target Company except with the prior approval of the

shareholders and the Acquirers undertake to do so.

III. BACKGROUND OF THE ACQUIRERS AND PAC

(1) This Counter Offer is being made by McDowell & Company Limited and Phipson Distillery Limited. United Breweries (Holdings)

Limited is a person acting in concert with the Acquirers.

(2) The Acquirers as well as the PAC are part of the UB Group of companies. UBHL is the principal shareholder of McDowell owning

42.15% of the voting capital of McDowell, whereas Phipson is a fully owned subsidiary of McDowell. As per the declarations

made in accordance with regulation 8 of the Regulations, the UB Group of Companies is the promoter group of Herbertsons

Limited.

McDowell

(3) McDowell, a company registered under the Act was incorporated on March 31, 1999. The objects of McDowell include carrying

on the business of marketing and manufacture of liquor. The registered office of McDowell is located at 51 Richmond Road,

Bangalore � 560025. The shares of McDowell are listed on the following stock exchanges: Bangalore Stock Exchange, The Stock

Exchange Mumbai, National Stock Exchange of India Limited, Madras Stock Exchange Limited, The Delhi Stock Exchange

Association Limited, The Calcutta Stock Exchange Limited, The Stock Exchange - Ahmedabad. The closing price of McDowell

as on the BSE on October 17, 2003 (last available market price) was Rs. 48.45/share. (Source: BSE Website)

(4) McDowell has complied with the applicable provisions of Chapter II of the Regulations.

(5) The names and addresses of the directors of McDowell (as on the date of the PA) are as follows:

Name of Director Address

Dr. Vijay Mallya* 6, Bulkley Avenue, Sausalito, California 94965, U.S.A.

Mr. S. R. Gupte* 7, Vittal Mallya Road, Bangalore � 560001

Mr. V. K. Rekhi* �Camelot�, Apartment 203, No.4, Kensington Road, Ulsoor, Bangalore � 560042

Mr. M.R. Doraiswamy Iyengar No.54, Ist �A� Main, II Stage, I Block, R.M.V. Extension, Bangalore � 560094

Mr. P. K. Kakodkar 4, �Beach Croft�, 17, Juhu Tara Road, Mumbai � 400049

Mr. Brij Mohan Labroo D-1/54, Vasant Vihar, New Delhi � 110057

Mr. Adi Burjor Godrej Godrej Industries Limited, Pirojshanagar, Eastern Express Highway, Vikhroli,

Mumbai � 400079

*Also on the board of HL. Dr. Vijay Mallya has an interest in the Acquirer and has undertaken to act in accordance with regulation

22(9) of the Regulations.

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(6) The brief audited financials of the company for the last three years is as follows:

(Amount in Rs Lacs)

Profit & Loss Statement for the 12-month periods ending 31-Mar-01 31-Mar-02 31-Mar-03

Income from Operations 86,993.76 87,110.70 97,657.12

Other Income 974.93 1,405.35 1,752.74

Total Income 87,968.69 88,516.05 99,409.86

Total Expenditure 81,273.16 81,892.11 92,573.83

Profit/(Loss) Before Depreciation, Interest & Tax 6,695.53 6,623.94 6,836.03

Depreciation 1,260.45 1,087.87 1,252.63

Interest 1,857.64 2,644.29 2,676.97

Profit/(Loss) before Tax 3,577.44 2,891.78 2,906.43

Provision for Tax 1,338.30 1,314.84 1,595.01

Profit/(Loss) after Tax 2,239.14 1,576.94 1,311.42

Balance Sheet Statement as on 31-Mar-01 31-Mar-02 31-Mar-03

Sources of Funds

Paid up equity share capital 5,172.00 5,172.00 5,172.00

Reserves & Surplus (excluding revaluation reserves) 21,022.89 20,970.67 21,115.16

Networth 26,194.89 26,142.67 26,287.16

Secured Loans 9,828.35 14,429.92 19,152.63

Unsecured Loans 5,686.13 11,613.48 14,573.62

Deferred Tax Liability - 929.60 1,154.61

Total 41,709.37 53,115.67 61,168.02

Uses of Funds

Net Fixed Assets 22,639.46 22,554.26 22,803.61

Investments 5,883.13 6,598.09 9,620.73

Net Current Assets 13,186.78 23,963.32 28,743.68

Total Miscellaneous Expenses not written off - - -

Total 41,709.37 53,115.67 61,168.02

Other Financial Data 31-Mar-01 31-Mar-02 31-Mar-03

Dividend (%)* 15.00% 20.00% 20.00%

Earning per share (Rs)** 4.33 3.05 2.54

Return on Networth (%)*** 8.55% 6.03% 4.99%

Book value per share (Rs)**** 50.65 50.55 50.83

*Computed as dividend for the period / paid up equity share capital at the end of the period

**Computed as Profit after Tax for the period/ number of fully paid up equity shares at the end of the period

***Computed as Profit after Tax for the period/ Networth at the end of the period

****Computed as Networth at the end of the period/ number of fully paid up equity shares at the end of the period

Phipson

(7) Phipson, a company registered under the Act was incorporated on July 4, 2001. The objects of Phipson include carrying on the

business of marketing and manufacture of liquor. Phipson owns certain liquor brands, and since July, 2001 these brands are sold

essentially in the four southern states of Andhra Pradesh, Tamil Nadu, Kerala and Pondicherry, by contract manufacturers against

receipt of �royalty�. The registered office of Phipson is located at Le Parc Richmonde, 51 Richmond Road, Bangalore � 560025.

Phipson is a wholly owned subsidiary of McDowell and the shares of Phipson are not listed on any stock exchange.

(8) As Phipson does not hold any shares in the Target Company, provisions of Chapter II of the Regulations are not applicable.

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(9) The names and addresses of the directors of Phipson (as on the date of the PA) are as follows:


A. Harish Bhat 28, IV Main, Shankar Nagar, Mahalaxmi Layout, Bangalore � 560 096

I. P. Suresh Menon 34, 1 Floor, S. T. Bed, IV Block, 80 FT. Road, Koramangala, Bangalore � 560 034

Navratan Dugar 406, Olympus III, Prestige Acropolis, Hosur Road, Bangalore

None of the above-mentioned directors are on the board of HL.

(10) The brief audited financials of the company since the incorporation of the company is as follows:(Amount in Rs Lacs)

Profit & Loss Statement for the periods ending 04-Jul-01 to 01-Oct-0230-Sep-02 to 31-Mar-03

(15 months) (6 months)

Other Income 17.21 ^ 142.64 ^^

Total Income 17.21 142.64

Total Expenditure 16.76 1.80

Profit/(Loss) Before Depreciation, Interest & Tax 0.45 140.85

Depreciation - -

Interest - 115.61

Profit/(Loss) before Tax 0.45 25.24

Provision for Tax 0.17 9.27

Profit/(Loss) after Tax 0.28 15.96

^Other Income for period ended September 30, 2002 comprised of royalty received (Rs. 17.21 lacs).

^^Other Income for period ended March 31, 2003 comprised of royalty received (Rs. 18.85 lacs), interest received on loan(Rs. 117.54 lacs) and interest received on fixed deposit with Banks (Rs. 6.25 lacs). Phipson owns certain liquor brands, and sinceJuly, 2001 these brands are sold essentially in the four southern states of Andhra Pradesh, Tamil Nadu, Kerala and Pondicherry,by contract manufacturers against receipt of �royalty�. The turnover on sale of these brands are not reflected in Phipson�s booksand as per its accounting practice, the royalty income is reflected under �other income�.

(Amount in Rs Lacs)

Balance Sheet Statement as on 30-Sep-02 31-Mar-03

Sources of Funds

Paid up equity share capital 5.00 5.00

Reserves & Surplus (excluding revaluation reserves) 0.28 16.25

Networth 5.28 21.25

Secured Loans - -

Unsecured Loans - 2,492.58

Total 5.28 2,513.83

Uses of Funds

Net Fixed Assets - -

Investments - 10.38

Net Current Assets 4.95 2,503.12

Total Miscellaneous Expenses not written off 0.33 0.33

Total 5.28 2,513.83

Other Financial Data 30-Sep-02 31-Mar-03

Dividend (%)* 0.00% 0.00%

Earning per share (Rs)** 0.57 31.93

Return on Networth (%)*** 5.36% 75.14%

Book value per share (Rs)**** 10.57 42.50

*Computed as dividend for the period / paid up equity share capital at the end of the period**Computed as Profit after Tax for the period/ number of fully paid up equity shares at the end of the period***Computed as Profit after Tax for the period/ Networth at the end of the period


9

UBHL

(11) UBHL (formerly known as United Breweries Limited) was incorporated on March 23, 1915 under the Indian Companies Act,

1913 and has its registered office at UB House, No. 1, Vittal Mallya Road, Bangalore � 560001. UBHL is engaged primarily in

the business of real estate development and investments. The shares of UBHL are listed on the following stock exchanges:

Bangalore Stock Exchange Limited, Calcutta Stock Exchange Association. Limited, Cochin Stock Exchange Limited, The Stock

Exchange, Ahmedabad, Hyderabad Stock Exchange Limited, The Stock Exchange, Mumbai, Madras Stock Exchange Limited, The

Delhi Stock Exchange Association Limited, The Ludhiana Stock Exchange Association. The closing price of UBHL as on the BSE

on October 17, 2003 (last available market price) was Rs. 24.00/share. (Source: BSE Website)

(12) UBHL has complied with the applicable provisions of Chapter II of the Regulations.

(13) The names and addresses of the directors of UBHL (as on the date of the PA) are as follows:


Dr. Vijay Mallya* 6, Bulkley Avenue, Sausalito, California 94965, U.S.A.

Mr. Shrikant G. Ruparel Ruparel House, 38, Ridge Road, Mumbai - 400 006

Mr. Mani Narayanswamy 22, I Main Road, Jayamahal Extension, Bangalore - 560 006

Mr. N. Srinivasan* T-19, Sixth Avenue, Besant Nagar, Chennai - 600 090

Mr. P. A. Murali Bldg No. 10, Flat No. 504, Shanti Park Apartments, Jayanagar 9th Block,

Bangalore - 560 011

Mr. A. Harish Bhat No. 28, 4th Main, Shankarnagar, Mahalakshmi Layout, Bangalore - 560 096

Mr. P. Subramani No.259, III Main, Sai Enclave, Kothanur Road Cross, Bangalore - 560 076

*Also on the board of HL. Dr. Vijay Mallya has an interest in the Acquirer and has undertaken to act in accordance with regulation

22(9) of the Regulations.

(14) The brief audited financials of the company for the last three years is as follows:

(Amount in Rs Lacs)

Profit & Loss Statement for the 12-month periods ending 31-Mar-01 31-Mar-02 31-Mar-03

Income from Operations 33,931.78 18,774.62 2,700.82

Other Income 4,257.91 1,141.37 1,977.36

Total Income 38,189.70 19,915.99 4,678.18

Total Expenditure 35,078.90 19,749.74 16,503.92

Profit/(Loss) Before Depreciation, Interest & Tax 3,110.80 166.25 (11,825.74)

Depreciation 1,034.66 466.79 98.01

Interest 2,064.25 3,812.12 4,352.98

Profit/(Loss) before Tax 11.89 (4,112.66) (16,276.73)

Provision for Tax - 26.87 -

Tax refund relating to previous years 298.45 - 228.73

Profit/(Loss) after Tax 310.34 (4,139.53) (16,048.00)

Balance Sheet Statement as on 31-Mar-01 31-Mar-02 31-Mar-03

Sources of Funds

Paid up equity share capital 3,797.55 2,290.50 2,290.50


Networth 18,553.31 16,563.86 9,971.01

Secured Loans 24,873.73 22,343.60 25,054.46

Unsecured Loans 7,403.28 5,085.31 5,694.37

Deferred Credits 13.52 - -

Total 50,843.85 43,992.77 40,719.85

Uses of Funds

Net Fixed Assets# 8,764.88 1,604.03 2,593.75

Investments 20,688.03 30,838.30 25,965.64


Total Miscellaneous Expenses not written off 904.70 472.44 270.68

P&L Account - - 9,455.15

Total 50,843.85 43,992.77 40,719.85

10

Other Financial Data 31-Mar-01 31-Mar-02 31-Mar-03

Dividend (%)* 14.90% 0.00% 0.00%

Earning per share (Rs)** 0.82 NA NA

Return on Networth (%)*** 1.67% NA NA






#Net of revaluation of Fixed Assets

Delisting

(15) Pursuant to this Counter Offer, the public shareholding of the Target Company will not reduce to 10% or less of the voting

capital of the Target Company, and therefore the provisions of regulation 21(3) of the Regulations do not apply.

General

(16) SEBI vide its order dated 19/2/2002 passed in the show cause notice dated 8/1/1999 issued to Dr. Vijay Mallya, inter alia directed

Dr Vijay Mallya to disinvest approximately 8% of the equity capital of HL as having been acquired in breach of the provisions

of the listing agreement and SEBI (Substantial Acquisition of Shares and Takeovers), 1994. In appeal filed by Dr. Vijay Mallya from

the said order of SEBI, SAT vide its order dated 1/08/2003 in effect set aside the SEBI order directing disinvestment. SEBI has

filed an appeal before the Hon�ble Supreme Court of India against the said order of SAT and the Hon�ble Supreme Court has

directed listing of the said appeal for November 3, 2003.

(17) Arising out of the SEBI Order dated 19/2/2002 in the show cause notice dated January 8, 1999 issued to Dr. Vijay Mallya,

adjudication proceedings were initiated by the Adjudicating and Enquiry Officer, SEBI who issued show cause notices inter alia

to Dr. Vijay Mallya, McDowell and UBHL under rule 4 of SEBI (Procedure for Holding Inquiry and Imposing Penalties by

Adjudicating Officer) Rules, 1995 requiring them to show cause why inquiry should not be held against them and why penalty

cannot be levied on them. The show cause notices have been replied and the Adjudicating and Enquiry Officer heard the notices

on October 6, 2003 and his orders are awaited.

IV. BACKGROUND OF THE TARGET COMPANY

(1) The Target Company was incorporated on September 29, 1936 under the Indian Companies Act, 1913. The Target Company has

its registered office at Ewart House, 22, Homi Modi Street, Mumbai � 400023. The Target Company is engaged in the business

of marketing and manufacture of liquor. Since 1972, the UB Group of Companies has been and continues to be in management

and control of Target Company. Shares of the Target Company are listed on the following stock exchanges: The Stock Exchange

Mumbai, The Delhi Stock Exchange Association Limited, The Stock Exchange � Ahmedabad, Bangalore Stock Exchange. (Source:

Capitaline 2000)

(2) As per the last audited accounts as on March 31, 2002 of the Target Company, the paid up equity share capital was Rs 9,52,20,730

comprising 95,22,323 Shares. There are no partly paid-up shares. There are no outstanding convertible instruments convertible

into equity shares. The share capital structure of the Target Company is as follows:

Shares of Target Company No. of Shares / % of Shares /

voting rights voting rights

Fully paid up equity shares 95,22,323 100%

Partly paid up equity shares Nil Nil

Total paid up equity shares 95,22,323 100%

Total voting rights in Target Company* 74,40,332* 78.14%*

* It may be noted that the judgment and order of the Learned Single Judge of the Hon�ble Bombay High Court dated 19-22 April,1999 and the judgment and order of the Hon�ble Division Bench of the Bombay High Court dated September 28, 2001 in appeal,have, inter alia held and declared the transactions in respect of acquisition of shares held in the Target Company in the namesof IMFA Holdings Private Limited and Mahameru Trading Company Private Limited, who are part of the Original Biddersaggregating to 15,12,441 equity shares of the issued capital of the Target Company, as well as the equity shares lodged for transferby Shirish Finance & Investment Private Limited (also part of the Original Bidders) aggregating to 3,64,750 equity shares of theTarget Company, as void and the voting rights in respect of the same have been frozen. Similarly, transactions of acquisition ofshares lodged by Beethoven Traders Private Limited (1,25,000 equity shares in the Target Company), Darrel Traders PrivateLimited (25,800 equity shares in the Target Company), and IMFA Holdings Private Limited (54,000 equity shares in the TargetCompany), all also part of the Original Bidders, have also been declared in the said judgments and orders as void.

11

(3) The status of compliance with Chapter II of the Regulations by the Target Company (as per letter from BSE dated October 15,

2003) is as under:

a) The disclosures given by HL under regulations 6(2) & 6(4) of the Regulations are not in order as HL has not given the same

as on 20/2/1997.

b) Further, HL has not submitted the disclosures under regulation 8(3) for the years 1998 & 1999, also the submission of

disclosures under regulation 8(3) for the year 2002 has been delayed by HL.

(4) The composition of the Board of Directors as provided in the annual report for the year ended March 31, 2002 (latest available)

is as follows:

Name Position

Vijay Mallya Executive Chairman

K R Chhabria Vice Chairman and Wholetime Director

S D Lalla Managing Director

S K Diwanji Director

S S Gandhi Director

S R Gupte Director

C L Jain Director

Ritu Mallya Director

R M Parekh Director

V K Rekhi Director

N Srinivasan Director

S K Bishwal Director

The following directors are common directors between the Board of Directors of the Target Company and the Board of Directors

of the Acquirers and PAC: Dr. Vijay Mallya, Mr. S.R. Gupte, Mr. N. Srinivasan and Mr. V.K. Rekhi. Dr. Vijay Mallya as Chairman

of the Target Company has an interest in the Acquirer and has undertaken to act in accordance with regulation 22(9) of the

Regulations. In addition, Mrs. Ritu Mallya, a director of the Target Company is related to Dr. Vijay Mallya. The aforementioned

common directors have undertaken to act in accordance with regulation 22(9) of the Regulations.

(5) The financials of the Target Company are provided below. As the Target Company has not filed its audited accounts for the year

ended March 31, 2003 with the stock exchanges where it is listed or published the same, it has not been possible to provide

the same in this LOF. In the event that the audited accounts of the Target Company for the aforementioned period are filed

with the stock exchanges/published prior to the closure of the Counter Offer, the same shall be published in a public

announcement in the same newspapers where the PA appeared.

(Amount in Rs Lacs)

Profit & Loss Statement for the 12-month periods ending 31-Mar-00 31-Mar-01 31-Mar-02 31-Mar-03

(unaudited)

Income from Operations 28,659.71 29,629.02 30,327.29 33,732

Other Income 499.90 361.83 664.72 477

Total Income 29,159.61 29,990.85 30,992.01 34,209

Total Expenditure 27,393.09 28,277.13 29,419.82 32,988

Profit/(Loss) Before Depreciation, Interest & Tax 1,766.52 1,713.72 1,572.19 1,221

Depreciation 323.26 291.13 282.87 265

Interest 639.01 664.93 568.02 351

Profit/(Loss) before Tax 804.26 757.66 721.30 605

Provision for Tax 380.00 320.00 265.00 217

Deferred Tax Liability - - 8.43 -

Profit/(Loss) after Tax 424.26 437.66 447.86 388

12

(Amount in Rs Lacs)

Balance Sheet Statement as on 31-Mar-00 31-Mar-01 31-Mar-02 31-Mar-03

(unaudited)

Sources of Funds

Paid up equity share capital 952.21 952.21 952.21 952


Networth 3,854.67 4,223.70 4,262.36

Secured Loans 1,887.41 1,657.44 1,359.28

Unsecured Loans 1,261.99 1,348.12 1,449.91

Deferred Tax Liability - - 213.58

Total 7,004.07 7,229.26 7,285.12

Uses of Funds

Net Fixed Assets 2,231.87 2,229.71 2,170.71

Investments 183.32 183.32 183.32


Total Miscellaneous Expenses not written off - - -

Total 7,004.07 7,229.26 7,285.12

Other Financial Data 31-Mar-00 31-Mar-01 31-Mar-02 31-Mar-03(unaudited)

Dividend (%)* 25.00% 25.00% 25.00%

Earning per share (Rs)** 4.46 4.60 4.70 4.08

Return on Networth (%)*** 11.01% 10.36% 10.51%


Source: Audited A/Cs as per Annual Reports of Target Company, unaudited A/Cs as per BSE website





(6) The status of compliance with listing requirements by the Target Company and penal actions by the stock exchanges, if any (asper letter from BSE dated October 15, 2003) is as follows:

Listing Agreement Description of the clauses of the Compliance (Y) /clauses Listing Agreement Non-compliance (N)

Clause 15/16 Intimation of book closure/record date Y

Clause 31(a) Yearly submission of annual reports N, Annual report of 2002 and 2003not submitted

Clause 35 Quarterly submission of shareholding pattern Y

Clause 38 Payment of annual listing fees Y

Clause 41 Publication of audited/un-audited results on aquarterly basis Y

Clause 3, 12, 21 Redressal of investor complaints 1 complaint pending as of date

Clause 47 Compliance Certificate/Appointment ofCompany Secretary N, Compliance Certificate under 47(c)

not submitted from Sept 2002,RTA appointment not informed

Clause 49 Implementation of corporate governance,if applicable Y

(7) The audited annual accounts of the Target Company for the years ended March 31, 2000, March 31, 2001 and March 31, 2002do not mention any mergers, demergers or spin offs involving the Target Company during the relevant periods.

(8) The Shares of the Target Company are not dematerialised, and are traded only on the �trade for trade settlement� window of

the Stock Exchanges. (Source: Annual accounts of the Target Company for the year ended March 31, 2002)

13

(9) The shareholding pattern of the Target Company before the Counter Offer and as after the Counter Offer is as follows:

Sr. Shareholders� Category No. of As a % of As a % No. of As a % As a % No. of As a % of As a %

No. shares outstanding of Voting shares to of of Voting shares outstanding of Voting

equity Equity be acquired outstan- Equity POST the equity Equity

capital Capital in the ding equity Capital Counter capital Capital

Counter capital Offer**

Offer

1 Promoters who areAcquirers

McDowell# 73,709 0.77 0.99 - - - 73,709 0.77 0.99

Phipson 0 0.00 0.00 43,00,000 45.16 57.79 43,00,000 45.16 57.79

2 Promoters who are PAC

UBHL 22,46,756 23.59 30.20 - - - 22,46,756 23.59 30.20

3 Group companies of the

Acquirers/PAC and deemed

to acting in concert -

Vittal Investments Private

Limited ^ 46,905 0.49 0.63 - - - 46,905 0.49 0.63

Devi Investments Private

Limited ^ 4,052 0.04 0.05 - - - 4,052 0.04 0.05

TOTAL 1+2+3 23,71,422 24.90 31.87 43,00,000 45.16 57.79 66,71,422 73.71 89.67

McDowell (Shares pending

transfer as outlined in

paragraph 4 of Section II)# 3,47,400 3.65 4.67 - - - 3,47,400 3.65 4.67

TOTAL 27,18,822 28.55 36.54 - - - 70,18,822 73.71 94.33

4 Promoter group excluding

promoters who are

Acquirers or PAC N A N A N A N A N A N A N A N A N A

5 FIs/MFs/FIIs/Banks/SFIs

Mutual Funds and UTI 18,450 0.19 0.25

Banks, FIs, Insurance Cos 8,258 0.09 0.11

FIIs 2,100 0.02 0.03

Sub total 28,808 0.30 0.39 25,03,501 26.29 5.67

6 Others

NRIs / OCBs 2,060 0.02 0.03

PCBs * 25,50,532 26.78 34.28

Indian Public 21,40,110 22.47 28.76

TOTAL 4+5+6 47,21,510 49.58 63.46

GRAND TOTAL 74,40,332 78.14 100.00 43,00,000 45.16 57.79 74,40,332 78.14 100.00

Shares on which voting 20,81,991 21.86 0.00 - - - 20,81,991 21.86 0.00

rights are restricted *

Source: BSE website as on September 30, 2003, information available with Acquirers

** Assuming full acceptance, and subject to approvals (as stated in Section VI hereinafter)

#McDowell & Company Limited has lodged 347,400 shares (3.65%) with the Target Company for registration of transfer, which

is deferred and pending. The aforesaid number of shares have been excluded from the �PCBs� and �Promoters who are

Acquirers� categories and are shown separately.

*The 20,81,991 Shares with respect to which voting rights are restrained (as outlined in paragraph (2) of Section IV) have been

excluded from the �PCBs� category

^Vital Investments Private Limited and Devi Investments Private Limited (group companies of the Acquirers/PAC and deemed

to be acting in concert) are not eligible to participate in the Counter Offer.

}

14

(10) The details of pending litigation related to the acquisition of shares of the Target Company to which any of the Acquirers/PACare a party (other than those listed in paragraph (3) of Section II and paragraph (16) and paragraph (17) of Section III) are asfollows:

a) Bombay High Court � Suit no. 3910 of 1997 � M.S. Reddy & others v/s K.R. Chhabria & others and suit no. 297 of 1999� Imfa Holdings Private Limited & others v/s Herbertsons Limited & another.

M.S. Reddy & others, shareholders of HL, filed a suit in the Bombay High Court in 1997 being Suit No. 3910 of 1997,challenging the acquisition of shares by the Kishore Chhabria/Madanlal Chhabria group, inter alia, as being in breach of theSEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1994 and/or 1997. HL is a party to the said suit, beingDefendant No. 12 therein.

Imfa Holdings Private Limited and Ors. (companies owned and/or controlled by Kishore Chhabria/Madanlal Chhabria) fileda suit in the Bombay High Court, being Suit No. 297 of 1999 against HL & Dr Vijay Mallya, inter alia, seeking a declarationthat they are the beneficial owners of certain shares in respect of which registration of transfer in their names had beenrefused by HL. These shares are also the subject matter of Suit No. 3910 of 1997.

At the final hearing of Notices of Motion in the said two Suits, by a judgment and order dated 19th-22nd April 1999, theLearned Single Judge of the Bombay High Court has restrained the Kishore Chhabria/Madanlal Chhabria group from exercisingvoting rights in respect of 20,81,991 shares aggregating to approximately 21.86% of the outstanding paid-up equity capitalof HL.

The Kishore Chhabria/Madanlal Chhabria group filed Appeals before the Division Bench of the Bombay High Court from thesaid judgement and order of the Learned Single Judge. The Hon�ble Division Bench of the Bombay High Court by a judgmentand order dated 28th September 2001 dismissed the said Appeals and confirmed the judgment and order of the LearnedSingle Judge.

The Kishore Chhabria/Madanlal Chhabria Group has filed four Special Leave Petitions before the Hon�ble Supreme Courtof India against the aforesaid judgment and order dated 28th September 2001. By an order dated 5th August 2002 the Hon�bleSupreme Court has granted leave. By a further order dated 16th April 2003 the Special Leave Petitions (now Civil Appeals)were adjourned sine die. The Supreme Court in the meantime has restrained HL from holding any Annual General Meeting,till disposal of the Appeals.

b) Petition nos. 21 of 1998, 22 of 1998, 52 of 2000 & 51 of 2000 filed by Shirish Finance & Investments Private Limited, ImfaHoldings Private Limited, Darrel Traders Private Limited & Beethoven Traders Private Limited before the Company LawBoard, western region bench under section 111A of the Companies Act, 1956.

HL refused registration of transfer of shares lodged for transfer by Imfa Holdings Private Limited, Shirish Finance &Investment Pvt. Ltd., Beethoven Traders Private Limited and Darrel Traders Private Limited as, inter alia, being in breachof the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997. All these companies which belong to theKishore Chhabria/Madanlal Chhabria group have filed Appeals u/s 111A of the Companies Act, 1956 before the Company LawBoard, Western Region against the refusal of HL to register transfer of these shares. All these Appeals are pending.

V. OFFER PRICE AND FINANCIAL ARRANGEMENTS

(1) The shares of the Target Company are listed on the following stock exchanges: The Stock Exchange Mumbai (�BSE�), The DelhiStock Exchange Association Limited (�DSE�), The Stock Exchange � Ahmedabad (�ASE�), Bangalore Stock Exchange (�BgSE�).

(2) The annualized trading turnover during the period March 2003 to August 2003, the 6 calendar months prior to the month in

which the PA appeared (based on dates on which actual trading took place during this period), is as follows:

Name of the Stock Total number of Total number of Annualized trading turnover

Exchange Shares traded issued Shares (in terms of % to total

listed Shares)

BSE ^ 8,300 95,22,323 0.17%

DSE*

ASE* No Trading 95,22,323 0.00%

BgSE*

^Source: CapitaLine 2000

*Source: Letter of Offer issued by the Original Bidders dated October 10, 2003

(3) The Target Company has 95,22,323 subscribed and paid up equity Shares. The annualised trading volume of the Target Company

on the BSE during the six months immediately preceding the month of the Public Announcement was less than 5% of the issued

Shares. Consequently, as per regulation 20(5) of the Regulations, the Shares of the Target Company are infrequently traded.

(4) There has been no preferential allotment of shares of the Target Company made to the Acquirers or the PAC at any time during

the twenty-six weeks prior to the date of the PA. Neither the Acquirers nor the PAC have acquired any shares of the Target

Company, including by way of allotment in a public or a rights issue, in the 12-month period prior to the date of the PA.

15

(5) The parameters that have been considered for the Offer Price are:

Parameter HL# McDowell

(comparable company)##

Book Value Per Share (Rs.)* 44.76 -

Earnings Per Share (Rs.)** 4.70 -

Average of Weekly High /Low of closing prices on BSE

(for 26 weeks preceding date of PA) (Rs.) 46.42 -

Price to Book Ratio*** 4.47 @ 0.96 ^

Price to Earnings Ratio**** 42.55 @ 19.29 ^

Return on Networth (%)***** 10.51 % 4.99 %

* Computed as Networth at the end of the period/ number of fully paid up equity shares at the end of the period


***Computed as Price Per Share/ Book Value Per Share

**** Computed as Price Per Share/ Earnings Per Share

***** Computed as Profit after Tax for the period/ Networth at the end of the period

#Based on audited results of March 2002

##Based on audited results of March 2003

@At Offer Price

^At the BSE closing price of Rs. 49.00 as at September 10,2003

The Offer Price is justified in accordance with regulation 20(4), regulation 20(5), regulation 20(11) and regulation 20(12) of the

Regulations.

(6) In light of the information contained in paragraphs (3), (4) and (5) of this Section, the Offer Price is justified in accordance with

regulation 20(11) of the Regulations.

(7) There are no non compete fee agreements.

(8) The Acquirers will ensure that in case they acquire shares from the date of the PA to upto November 20, 2003, the final offer

price shall not be less than the price paid by the Acquirers in such acquisitions.

(9) The total financial resources for this Counter Offer, assuming full acceptance will be Rs. 92.45 crores (Rupees Ninety Two Crores

Forty Five Lacs only). The Acquirers by way of escrow arrangements has deposited an amount of Rs. 23.10 crores (Rupees Twenty

Three Crores Ten Lacs Only) in an account with Corporation Bank, Industrial Finance Branch, Queen�s Road, Bangalore � 560001,

in accordance with the Regulations. Assuming full acceptance at the Offer Price, the amount in escrow is in accordance with

the Regulations. The Manager to the Counter Offer has been duly authorised by the Acquirers to realize the value of the escrow

in terms of the Regulations.

(10) The Acquirers have made firm arrangements for financial resources required to implement this Counter Offer and have passed

resolutions by their Board of Directors to this effect. Amounts totalling to Rs. 92.45 crores (Rupees Ninety Two Crores Forty

Five Lacs only) have been earmarked , by a combination of the following: (i) the unconditional line of credit from Rabo India Finance

Private Limited for an amount of Rs. 45 crores (Rupees Forty Five Crores only), (ii) the amount of Rs. 21 crores (Rupees Twenty

One Crores only) placed by way of a cash deposit with Corporation Bank, Industrial Finance Branch, Bangalore � 560001, (iii)

the amount of Rs. 10 crores (Rupees Ten Crores only) placed by way of a cash deposit with Citibank N.A., 204, Prestige Meridian

2, 30 M.G. Road, Bangalore � 560001, (iv) the amount deposited as a cash deposit in escrow as outlined in paragraph (9) above,

(collectively, �Firm Arrangements�) exclusively for the purpose of fulfilling the obligations under the Counter Offer and the

proceeds of the said Firm Arrangements be used exclusively for the purpose of fulfilling the obligations under the Counter Offer.

S. Vishnumurthy (Reg. No. 22715), partner of M/s Vishnu Ram and Company (Tel: 080 � 332 3545 Fax: 080 � 313 0507), 652,

80 Feet Road, Rajajinagar, Bangalore � 560010, chartered accountants and statutory auditors of Phipson Distillery Limited, have

vide their certificate dated September 9, 2003 and October 15, 2003, certified that adequate financial resources are available

with the Acquirers for fulfilling the obligations for payment under the Counter Offer. The Manager to the Counter Offer confirms

that on the basis of information available, that adequate funds are available with the Acquirers to implement this Counter Offer

in full.

16

VI. STATUTORY APPROVALS REQUIRED FOR THE COUNTER OFFER

(1) The Counter Offer is subject to the approval(s) as may be required from the Reserve Bank of India (RBI) under the ForeignExchange Management Act, 1999 (�FEMA�) for acquiring shares tendered by non-resident shareholders including NRIs/ FIIs andOCBs. The Acquirers intend to apply for the same after the acceptance is determined pursuant to the closure of the CounterOffer. In case of inability of the Acquirers to make payment within 30 days from the closure of the Counter Offer in respectof the acquisition of shares tendered in the Counter Offer by the non-resident shareholders due to non-receipt of approval fromthe RBI under FEMA, SEBI has a power to grant extension of time to the Acquirers for payment of consideration to shareholderssubject to the Acquirers agreeing to pay interest as directed by SEBI.

(2) As Phipson proposes to acquire all the Shares validly tendered in the Counter Offer, as on the date of this PA, to the best ofthe knowledge of the Acquirers, there are no other approvals required to acquire equity shares that are tendered pursuant tothis Counter Offer.

(3) In case of non-receipt of the said statutory approvals within time, SEBI has a power to grant extension of time to the Acquirersfor payment of consideration to shareholders subject to the Acquirers agreeing to pay interest as directed by SEBI. In case therequisite statutory approvals are not obtained on time on account of wilful default or neglect or inaction or non-action by theAcquirers, then SEBI may initiate action under regulation 22(13) of the Regulations.

VII. TERMS AND CONDITIONS STIPULATED BY THE ACQUIRERS FOR ACCEPTANCE OF THE COUNTEROFFER

(1) The Counter Offer is made to all the shareholders of the Target Company, other than the Acquirers and the PAC, whose namesappear in the register of members on September 12, 2003 and also to those persons who own the Shares any time prior tothe closure of the Counter Offer, whether or not they are registered as members (�Eligible Persons�).

(2) Persons, whether or not appearing as such on the register of members as on the Specified Date, who wish to tender their Sharespursuant to this Counter Offer, will be required to send their acceptances in the form and manner specified in Procedure forAcceptance and Settlement.

(3) The shareholders to whom this Counter Offer is being made, are free to offer his/her shareholding in the Company, in wholeor in part while accepting the Counter Offer.

(4) There are no Shares which are subject to a lock-in.

(5) Regulation 26 of the Regulations provides for an upward revision of the offer in respect of the price and the number of sharesto be acquired, and as stated in the PA any such upward revision can be made at any time upto November 20, 2003; and regulation27 of the Regulations allows withdrawal of the offer under certain circumstances. Any such revision/withdrawal would be informedby way of an announcement in the same newspapers where the original public announcement appeared. In case of revision, therevised price would be payable by the Acquirers for all the Shares tendered validly anytime during the offer.

(6) The instructions, authorizations and provisions contained in the Form and Section VIII of the Letter of Offer (Procedure forAcceptance and Settlement) constitute part of the terms of the Counter Offer.

(7) The acceptance of the Counter Offer of the Acquirers is entirely at the discretion of the equity shareholders of the TargetCompany. The Acquirers will not be responsible in any manner for any loss of equity share certificate(s) and/or offer acceptancedocuments during transit and the equity shareholders of the Company are advised to adequately safeguard their interest in thisregard.

(8) The acceptance must be unconditional and should be sent in the attached form duly filled in and duly signed together with allthe necessary documents (as specified under the Section VIII of the Letter of Offer - Procedure for Acceptance and Settlement)and should be received at any of the Collection Centres mentioned in Section VIII, on or before 5.30 p.m. Indian Standard Timeon December 3, 2003. In case of any lacunae and/or defect or in case any change or modification is made, the acceptance is liableto be rejected.

(9) In case the number of Shares validly tendered in the Counter Offer by the shareholders of the Target Company are more thanthe Shares to be acquired under the Counter Offer, the acquisition of Shares from each shareholder will be, as per the provisionsof regulation 21(6) of the Regulations, on a proportionate basis in such a way that the acquisition from any shareholder shall notbe less than the minimum marketable lot, or the entire holding if it is less than the marketable lot. The minimum marketablelot for the shares of the Target Company is 100 (one hundred). The Acquirers are of the opinion that this will benefit the smallshareholders and the shareholders holding Shares in odd lots.

(10) Accidental omission to dispatch this document or any further communication in this regard to any person to whom this CounterOffer has been made to or non-receipt of any such document by any such person shall not invalidate the Counter Offer in anyway. In case of non-receipt of the Letter of Offer the shareholder may, obtain a copy of the Letter of Offer from the SEBI websiteas mentioned earlier, or obtain a copy of the same from the Manager / Registrar to the Counter Offer on providing suitabledocumentary evidence of acquisition/ownership of the said Shares.

(11) Other Approvals: Phipson proposes to acquire all the Shares validly tendered in the Counter Offer. In the event that McDowellor UBHL are required to acquire the Shares validly tendered in the Counter Offer, they would require approval of their

shareholders under section 372A of the Companies Act, 1956.

17

VIII. PROCEDURE FOR ACCEPTANCE AND SETTLEMENT, AND WITHDRAWAL

(1) The equity shareholders of the Target Company, who wish to avail of and accept this Counter Offer should deliver the following

documents as soon as possible by Registered Post with Acknowledgement due or in person or by courier, as applicable, so as

to reach the Registrar to the Counter Offer / Collection Centres at the addresses mentioned on or before 5.30 p.m. Indian

Standard Time on December 3, 2003.

(a) Shares held by registered shareholders:

(i) The enclosed Form duly completed and signed in accordance with the instructions contained therein, by the holders

of the Shares of the Target Company. In case of shares held in joint names, names should be filled up in the same order

in which they hold Shares in the Company. This order cannot be changed or altered nor can any new name be added

for the purpose of accepting the Counter Offer.

(ii) Original equity share certificate(s).

(iii) Valid equity share transfer form(s) duly signed (by all the equity shareholders in case the Shares are in joint names)

as per the specimen signatures lodged with the Target Company and duly witnessed at the appropriate place. A blank

equity share transfer form is enclosed along with this Letter of Offer.

(iv) PLEASE DO NOT FILL IN ANY OTHER DETAILS IN THE TRANSFER DEED.

(b) Shares held by persons not registered as shareholders:

(i) The enclosed Form duly completed and signed in accordance with the instructions contained therein.

(ii) Original equity share certificate(s) accompanied by valid share transfer forms as received from the market, wherein

the name of the buyer has not been filled in.

(iii) Original broker contract note of a registered broker of a recognized stock exchange in relation to the purchase of the

Herbertsons shares being tendered in this case.

(iv) Persons under this clause should submit their acceptance and necessary documents by Registered Post or courier or

in person to the Registrar at their offices in Mumbai (mentioned in the LOF) only.

(c) In case the share certificate(s) and the transfer deed(s) are lodged with the Target Company / its transfer agents for transfer,

then the acceptance shall be accompanied by the acknowledgment of lodgment with, or receipt by, the Company/ its transfer

agents, of the share certificate(s) and the transfer deed(s).

(d) No indemnity is required from persons not registered as shareholders.

(2) Non-resident shareholders should enclose copy(ies) of permission received from Reserve Bank of India to acquire Shares held

by them in the Target Company.

(3) In case of non-receipt of the Letter of Offer, the Eligible Persons may obtain a copy of the Letter of Offer from the SEBI

website as mentioned earlier, or obtain a copy of the same from the Manager to the Counter Offer on providing suitable

documentary evidence of acquisition of the Shares of the Target Company. Alternatively those Eligible Persons desirous of

tendering their Shares in the Target Company to the Acquirers may participate in the Counter Offer by sending their consent

in writing to the Registrar, on a plain paper stating the name, address, no. of Shares held, no. of Shares offered, distinctive nos.,

folio no., the original contract note issued by a registered share broker of a recognized stock exchange through whom such Shares

were acquired, along with the original Share Certificate(s) and transfer deed(s) duly signed (as specified in (1)(a) and (1)(b), as

applicable, of this Section), either by hand delivery or by Registered Post or courier, such that these are received by the Collection

Centres on or before the scheduled time on December 3, 2003.

(4) All the shareholders should provide all relevant documents which are necessary to ensure transferability of the Shares in respect

of which the acceptance is being sent. Such documents may include (but not be limited to):

(a) Duly attested death certificate and succession certificate (in case of single shareholder) in case the original shareholder has

expired.

(b) Duly attested power of attorney if any person apart from the shareholder has signed acceptance form or transfer deed(s).

(c) No objection certificate from any lender, if the Shares in respect of which the acceptance is sent, were under any charge,

lien or encumbrance.

(d) In case of corporates, the necessary corporate authorizations (including board and/or general meeting resolutions). The

common seal of the corporate must be affixed.

18

(5) The Form along with all the relevant documents should be submitted at any of the collections centers (�Collection Centres�)

below subject to paragraph (1) of this section. All the centers mentioned herein below would be open as follows:

Location Collection Contact Mode of Phone Nos. Fax Nos. Timings

Centres Person Delivery

Mumbai Computech Sharecap Mr. Patrick Butelho �Hand Delivery 022 � 2267 1824 022 � 2267 0380 Mon-Sat: 11.00 am

Limited Ms. Shaila Borkar �Registered Post 022 � 2267 1825 to 5.30 pm

147 Mahatma Gandhi 022 � 2267 1826

Road, 3rd

Floor

Opp. Jehangir Art Gallery

Fort, Mumbai � 400023

Mumbai Corporation Bank � Mr. B. Nagaraj Shenoy �Hand Delivery 022 � 2284 1406 022 � 2284 3823 Mon-Fri: 10.00 am

Capital Market Branch to 5.00 pm

Nariman Bhavan, IV Floor Sat: 10.00 am to

Nariman Point 2.00 pm

Mumbai � 400021

Bangalore Corporation Bank Mr. A. Ramdas Prabhu �Hand Delivery 080 � 221 8225 080 � 227 4157 Mon-Fri: 10.00 am

No. 14/3, N. T. Road 080 � 221 5491 to 5.00 pm

Rashtrothana Parishat Sat: 10.00 am to

Building 2.00 pm

Bangalore � 560002

New Delhi Corporation Bank Mr. S. P. Bakshi �Hand Delivery 011 � 2341 7547 011 � 2341 8073 Mon-Fri: 10.00 am

P.B. No. 162, M41 011 � 2341 4537 to 5.00 pm

Connaught Circus Sat: 10.00 am to

New Delhi � 110001 2.00 pm

Kolkata Corporation Bank Mr. Sanjay Bakshi �Hand Delivery 033 � 2242 5668 033 � 2242 5583 Mon-Fri: 10.00 am

Mookherjee House 033 � 2242 2268 to 5.00 pm

I Floor, 17 Sat: 10.00 am to

Brabourne Road 2.00 pm

P.B. No. GPO 2352

Kolkata � 700001

Chennai Corporation Bank Mr. P. S. Baliga �Hand Delivery 044 � 2533 0817 044 � 2534 2339 Mon-Fri: 10.00 am

49, Armenian Street 044 � 2534 2085 to 5.00 pm

P.B. No. 237, George Town Sat: 10.00 am to

Chennai � 600001 2.00 pm

PLEASE NOTE THAT NO SHARES / ACCEPTANCES SHOULD BE SENT DIRECTLY TO THE ACQUIRERS/PAC OR TO THE

MANAGER TO THE COUNTER OFFER.

(6) The shareholders to whom this Counter Offer is being made, are free to offer his/her shareholding in the Company, in whole

or in part while accepting the Counter Offer.

(7) Consideration will be paid by crossed Account Payee cheque or demand draft or pay order to those equity shareholders of the

Target Company whose share certificates and other documents are found in order and are accepted by the Acquirers. Such

cheques/demand draft/payorder would be sent by registered post for amounts exceeding Rs.1500/- and otherwise by UPC. The

cheque or demand draft or pay order will be drawn in the name of the first named person in case of joint shareholders. The

unaccepted share certificates would be returned by registered post, at the shareholders�/unregistered owners� sole risk, to the

first/sole holder.

(8) The Registrar to the Counter Offer will hold in trust the share certificates, Forms duly filled in and the transfer deed(s) on

behalf of the shareholders of the Target Company who have accepted the Counter Offer, till the time the consideration and/

or the share certificates are posted.

(9) The Acquirers intend to complete all formalities, including the payment of consideration within a period of 30 days from the

closure of the Counter Offer that is, by January 2, 2004. However if the Acquirers are unable to complete the process within

the above time frame due to non-receipt of statutory approvals, SEBI has a power to grant extension of time to the Acquirers

for payment of consideration to shareholders subject to the Acquirers agreeing to pay interest as directed by SEBI.

(10) Taxation (applicable to Non-resident Indians/OCBs/Non-domestic Companies)

(a) As per the provisions of Section 195(1) of the Income-tax Act, 1961 (�IT Act�), any person responsible for paying to a non-

resident any sum chargeable to tax is required to deduct tax at source (including surcharge, if applicable). Since the

consideration payable under the Counter Offer would be chargeable to capital gains under Section 45 of the IT Act, the

Acquirers will deduct tax at source on the gross consideration payable to Non-resident Indians, Overseas Corporate Bodies

and Non-domestic companies, at the appropriate rate as prescribed under the Finance Act 2003 together with surcharge

if any applicable.

19

(b) For the purpose of determining as to whether the capital gains are short-term or long-term in nature:

n In the case of physical Shares registered with the Target Company, the date of registration of the Shares with the Target

Company shall be taken as the date of acquisition.

n In the case of physical Shares not registered with the Target Company, the capital gain shall be assumed to be short-

term in nature.

n In case of any ambiguity, incomplete or conflicting information or the information not being made available to the

Acquirers (whether or not the same is available with the Target Company), the capital gain shall be assumed to be

short-term in nature.

(c) In the event the aforementioned categories of shareholders require the Acquirers not to deduct tax or to deduct tax at a

lower rate than what is prescribed under the Finance Act 2003 as aforesaid or on a lower amount, they would need to

obtain an order from the Income Tax authorities under Section 195(3) of the IT Act, and submit the same to the Acquirers

while submitting the Form. On failure to produce such certificate from the Income Tax authorities, the Acquirers will deduct

tax as aforesaid, and a certificate in the prescribed form shall be issued to that effect.

(d) No tax will be deducted at source for any other category of shareholders.

(e) Shareholders are advised to consult their tax advisors for the treatment that may be given by their respective assessing

officers in their case, and the appropriate course of action that they should take. The Acquirers and the Manager to the

Counter Offer do not accept any responsibility for the accuracy or otherwise of such advice.

(11) Shareholders who have accepted the Counter Offer by tendering the requisite documents, in terms of the Public Announcement

/ Letter of Offer, can withdraw the same upto November 29, 2003 by completing the enclosed Form of Withdrawal and submitting

the same as soon as possible by Registered Post with Acknowledgement due or in person or by courier, as applicable, so as

to reach the Registrar to the Counter Offer / Collection Centres at the addresses mentioned on or before the scheduled time

on November 29, 2003. In case of Shares held in joint names, names should be filled up in the same order in the Form of

Withdrawal as the order in which they hold Shares in the Company. This order cannot be changed or altered nor can any new

name be added for the purpose of withdrawing from the Counter Offer. In case of non-receipt of the Letter of Offer, the Eligible

Persons may obtain a copy of the Form of Withdrawal annexed to the Letter of Offer from the SEBI website as mentioned earlier,

or obtain a copy of the same from the Manager to the Counter Offer or Registrar to the Counter Offer on providing a copy

of the acknowledgement received while submitting the Form. Alternatively those persons desirous of withdrawing from the

Counter Offer may do so by sending their request in writing to the Registrar to the Counter Offer, on a plain paper stating

the name, address, no. of Shares offered, no. of Shares being withdrawn, distinctive nos., folio no., either by hand delivery or

by Registered Post or courier, such that these are received by the Registrar on or before 5.30 p.m. Indian Standard Time on

November 29, 2003.

IX. DOCUMENTS FOR INSPECTION

(1) Copies of the following documents will be available for inspection at the office of the Manager to the Offer at Bakhtawar, 3rd

floor, 229 Nariman Point, Mumbai � 400021 on any working day (i.e. Monday to Friday and not being a bank holiday in Mumbai)

between 10:30 am to 1:00 pm from November 4, 2003 to December 3, 2003, being the period when the shareholders can tender

their Shares pursuant to the Counter Offer.

(a) Certificates of incorporation, Memorandum and Articles of Association of McDowell, Phipson and UBHL.

(b) Chartered Accountant�s certificate dated September 9, 2003 and October 15, 2003, certifying adequacy of financial resources

with the Acquirers to fulfill the obligations for payment under the Counter Offer.

(c) Audited annual reports of McDowell and UBHL for the periods 2000-2001, 2001-2002, 2002-2003. In addition, audited

financials for Phipson are available for the periods July 4, 2001 to September 30, 2002 and October 1, 2002 to March 31,

2003.

(d) Audited annual report of Herbertsons for the year 1999-2000, 2000-2001 and 2001-2002

(e) Letter from Corporation Bank, dated September 9, 2003 and October 14, 2003, confirming the amount kept in escrow and

lien in favour of the Manager to the Counter Offer.

(f) Published copy of the PA dated September 10, 2003, revised public announcement dated October 16, 2003 and corrigendum

to the public announcements expected to be issued and dated October 28, 2003.

(g) Copy of the letter from SEBI in terms of proviso 2 to Regulation 18(2) dated October 14, 2003.

(h) Documents pertaining to the pending litigations outlined in paragraph (3) of Section II, paragraph (16) of Section III and

paragraph (10) of Section IV.

20

X. DECLARATION BY THE ACQUIRERS

The Acquirers/PAC accept full responsibility for the information contained in this Letter of Offer (except for the information on the

Target Company and the Original Bid, which is compiled from publicly available sources) and would be jointly and severally responsible

for ensuring compliance with the Regulations, as witnessed by the signature of their authorized signatories for the purpose of the

Counter Offer.

For and on behalf of the Acquirers and the PAC

Sd/- Sd/- Sd/-

Authorised Signatory Authorised Signatory Authorised Signatory

McDowell Phipsons UBHL

Bangalore

October 20, 2003

FORM OF ACCEPTANCE CUM ACKNOWLEDGEMENT

Dear Sirs,

Re: Counter Offer by McDowell & Company Limited, Phipson Distillery Limited and person acting in concert for 43,00,000 shares of Herbertsons Limited at the

Offer Price in accordance with the Letter Of Offer dated October 20, 2003 and subsequent amendments, if any (�Counter Offer�)

I / We refer to the aforementioned Letter of Offer for acquiring the Shares held by me/us in Herbertsons Limited. I / We the undersigned have read the Letter of Offer and understood

its contents including the terms and conditions as mentioned therein.

I / We, holding Shares in the physical form, accept the Counter Offer and enclose the original equity share certificate(s) and the duly signed Transfer Deed(s) in respect of my / our

Shares offered for sale as detailed under:

To

The Acquirers � UB Group Herbertsons Counter Offer


Unit: UB Group Herbertsons Counter Offer




I / We understand that the original share certificates, form of acceptance duly filled in and the valid transfer deed(s) will be held in trust for me/us by the Registrar to the CounterOffer until the time the Acquirers make payment of consideration as mentioned in the Letter of Offer. I / We also understand that the Acquirers will pay the purchase considerationonly upon acceptance by them of the Shares tendered and only after verification of the documents and signatures.

I / We confirm that the Shares of Herbertsons being tendered by me / us under this Counter Offer are free from liens, charges and encumbrances of any kind whatsoever.

I/ We authorize the Acquirers to accept the Shares so offered which they may decide to accept in consultation with the Manager to the Counter Offer and in terms of the Letterof Offer and I /We further authorize the Acquirers to return to me/us, equity share certificate(s) in respect of which the offer is not found valid /not accepted specifying the reasonsthereof.

I/We authorise the Acquirers to accept the Shares so offered or such lesser number of Shares that they may decide to accept in terms of the Letter of Offer and I/we further authorisethe Acquirers to split/consolidate the share certificates comprising the Shares that are not acquired to be returned to me/us and for the aforesaid purposes the Acquirers are herebyauthorised to do all such things and execute such documents as may be found necessary and expedient for the purpose.

I/We irrevocably authorize the Acquirers or their nominees to send by Registered Post /UPC, as may be applicable at my/ our risk the cheque/ demand draft in full and final settlementof the amount due to me/ us and/ or other documents or papers or correspondence to the Sole / First Holder whose name and address are set out above, in full and final settlementof the amount due to me/us.

I/We confirm that the particulars given above are true and correct.

Yours sincerely,

No. of SharesCertificate numberLedger Folio No.

Total Number of Shares.

Distinctive numbers

From To

Acknowledgement Slip

Received from Mr./Ms.

an application for sale of

Equity Share(s) of Herbertsons Limited together with share certificate(s) and transfer deed(s) under the Counter Offer

by the Acquirers to the shareholders of Herbertsons Limited.

Folio No. Signature of Official Date of Receipt

UB Group Herbertsons Counter Offer

Stamp of collection centre

TEAR ALONG THIS LINE

COUNTER OFFER OPENS ON November 4, 2003 (Tuesday)

COUNTER OFFER CLOSES ON December 3, 2003 (Wednesday)

Signed and Delivered FULL NAME(S) ADDRESS SIGNATURE(S)

First/Sole Holder

Joint Holder 1 (if any)



Place: Date:

So as to prevent fraudulent encashment in transit, the shareholder(s) may at their option provide details of bank account of the first/sole shareholder and the consideration cheque/ demanddraft will be drawn accordingly.

Type of A/c

A/c No

Full Name of Bank & Branch, Address

%

%

INSTRUCTIONS

(1) Please note that these instructions are illustrative and attention is drawn to Section VIII for comprehensive details regarding the procedure for acceptance and settlement.

(2) The equity shareholders of the Target Company, who wish to avail of and accept this Counter Offer should deliver the Form of Acceptance cum Acknowledgement (�Form�)as soon as possible by registered post or in person or by courier, as applicable, so as to reach the Collection Centres before the scheduled time mentioned below on December3, 2003.

Location Collection Contact Mode of Phone Nos. Fax Nos. TimingsCentres Person Delivery

Mumbai Computech Sharecap Mr. Patrick Butelho �Hand Delivery 022 � 2267 1824 022 � 2267 0380 Mon-Sat: 11.00 amLimited Ms. Shaila Borkar �Registered Post 022 � 2267 1825 to 5.30 pm147 Mahatma Gandhi 022 � 2267 1826Road, 3

rd Floor

Opp. Jehangir Art GalleryFort, Mumbai � 400023

Mumbai Corporation Bank � Mr. B. Nagaraj Shenoy �Hand Delivery 022 � 2284 1406 022 � 2284 3823 Mon-Fri: 10.00 amCapital Market Branch to 5.00 pmNariman Bhavan, IV Floor Sat: 10.00 am toNariman Point 2.00 pmMumbai � 400021

Bangalore Corporation Bank Mr. A. Ramdas Prabhu �Hand Delivery 080 � 221 8225 080 � 227 4157 Mon-Fri: 10.00 amNo. 14/3, N. T. Road 080 � 221 5491 to 5.00 pmRashtrothana Parishat Sat: 10.00 am toBuilding 2.00 pmBangalore � 560002

New Delhi Corporation Bank Mr. S. P. Bakshi �Hand Delivery 011 � 2341 7547 011 � 2341 8073 Mon-Fri: 10.00 amP.B. No. 162, M41 011 � 2341 4537 to 5.00 pmConnaught Circus Sat: 10.00 am toNew Delhi � 110001 2.00 pm

Kolkata Corporation Bank Mr. Sanjay Bakshi �Hand Delivery 033 � 2242 5668 033 � 2242 5583 Mon-Fri: 10.00 amMookherjee House 033 � 2242 2268 to 5.00 pmI Floor, 17 Sat: 10.00 am toBrabourne Road 2.00 pmP.B. No. GPO 2352Kolkata � 700001

Chennai Corporation Bank Mr. P. S. Baliga �Hand Delivery 044 � 2533 0817 044 � 2534 2339 Mon-Fri: 10.00 am49, Armenian Street 044 � 2534 2085 to 5.00 pmP.B. No. 237, George Town Sat: 10.00 am toChennai � 600001 2.00 pm

PLEASE NOTE THAT NO SHARES/FORMS SHOULD BE SENT DIRECTLY TO THE ACQUIRERS/PAC OR TO THE MANAGER TO THE OFFER.

(3) All queries pertaining to this Counter Offer may be directed to the Registrar to the Counter Offer.

(4) Shareholders holding registered Shares should submit the Form duly completed and signed in accordance, by the holders of the Shares, along with the original equity sharecertificate(s) and valid equity share transfer form(s) duly signed as per the specimen signatures lodged with the Target Company and duly witnessed at the appropriate place. Pleasedo not fill in any other details in the transfer deed.

(5) In case of shares held in joint names, names should be filled up in the same order in the Form and in the transfer deed(s) as the order in which they hold Shares in theCompany, and should be duly witnessed. This order cannot be changed or altered nor can any new name be added for the purpose of accepting the Counter Offer.

(6) In case where the signature is subscribed by thumb impression, the same shall be verified and attested by a Magistrate, Notary Public or Special Executive Magistrateor a similar authority holding a Public Office and authorized to use the seal of his office.

(7) Persons who own Shares (as on the Specified Date or otherwise) but are not the registered holders of such Shares and who desire to accept the Counter Offer,will have to communicate their acceptance in writing to the Registrar to the Counter Offer together with the original contract note issued by the broker, the share certificate(s),the transfer deed(s) with the buyers details not filled in and other relevant documents. In case the share certificate(s) and transfer deed(s) are lodged with the Target Company/its transfer agents for transfer, then the Form shall be accompanied by the acknowledgment of lodgment with, or receipt by, the Company/its transfer agents, of the sharecertificate(s) and transfer deed(s). Persons under this clause should submit their acceptance and necessary documents by registered post or courier or in person to the Registrarat their offices in Mumbai only.

The sole/first holder may also mention particulars relating to savings/current account number and the name of the bank and branch with whom such account is held in therespective spaces allotted in the Form, to enable the Registrar to print the said details in the cheques after the name of the payee.

(8) Non-resident shareholders should enclose copy(ies) of permission received from Reserve Bank of India to acquire Shares held by them in the Target Company.

(9) Non-resident shareholders are advised to refer to the clause on taxation in Section VIII of the LOF regarding important disclosures regarding the taxation of the considerationto be received by them.

(10) In case of bodies corporate, certified copies of appropriate authorization (including Board/shareholder resolutions, as applicable) authorizing the sale of Shares along withspecimen signatures duly attested by a bank must be annexed. The common seal should also be affixed.

(11) All the shareholders should provide all relevant documents which are necessary to ensure transferability of the Shares in respect of which the acceptance is being sent. Suchdocuments may include (but not be limited to):

(1) Duly attested death certificate and succession certificate (in case of single shareholder) in case the original shareholder has expired.

(2) Duly attested power of attorney if any person apart from the shareholder has signed acceptance form or transfer deed(s).

(3) No objection certificate from any lender, if the Shares in respect of which the acceptance is sent, were under any charge, lien or encumbrance.

Note: All future correspondence, if any, should be addressed to Registrar to the Counter Offer at the following Address:




Opp. Jehangir Art Gallery, Fort, Mumbai � 400023

Tel. No. : 022 � 2267 1824/ 25/ 26 Fax : 022 � 2267 0380




FORM OF WITHDRAWAL

Dear Sirs,

Re: Counter Offer by McDowell & Company Limited, Phipson Distillery Limited and person acting in concert for 43,00,000 shares

of Herbertsons Limited at the Offer Price in accordance with the Letter Of Offer dated October 20, 2003 and subsequent

amendments, if any (�Counter Offer�)

I/We refer to the aforementioned Letter of Offer for acquiring the equity shares held by me/us in Herbertsons Limited.

I/We, the undersigned have read the Letter of Offer and understood its contents including the terms and conditions as mentioned therein.

I/We hereby consent unconditionally and irrevocably to withdraw my/our shares from the Counter Offer and I/we further authorize the Acquirers

to return to me/us, the tendered equity share certificate(s)/ share(s) at my/our sole risk.

I/We note that upon withdrawal of my/our Shares from the Counter Offer, no claim or liability shall lie against the Acquirers/ PAC/ Manager

to the Counter Offer/Registrar to the Counter Offer.

I/We note that this Form of Withdrawal should reach the Registrar to the Counter Offer at any of the collection centres mentioned in the

Letter of Offer or as mentioned overleaf as per the mode of delivery indicated therein on or before November 29, 2003.

I/We note that the Acquirers/ PAC / Manager to the Counter Offer/Registrar to the Counter Offer shall not be liable for any postal delay/loss

in transit of the Shares held in physical form.

I/We also note and understand that the Acquirers/ PAC will return the original share certificate(s), share transfer deed(s) and Shares only on

completion of verification of the documents and signatures.

The particulars of tendered original share certificate(s) and duly signed transfer deed(s) are detailed below:

From

Name:

Address:

To

The Acquirers � UB Group Herbertsons Counter Offer






No. of SharesCertificate No(s).Sr. No.

1.

2.

3.

4.

Total Number of Equity Shares.

Distinctive No.

From To

Acknowledgement Slip

UB Group Herbertsons Counter Offer

Received form of withdrawal from Mr./Ms.

Folio No.

Signature of Official Date of Receipt

Stamp of collectioncentre

TEAR ALONG THIS LINE%

%

I/We confirm that the particulars given above are true and correct.

Yours faithfully,

COUNTER OFFER OPENS ON November 4, 2003 (Tuesday)

LAST DATE OF WITHDRAWAL November 29, 2003 (Saturday)

COUNTER OFFER CLOSES ON December 3, 2003 (Wednesday)

INSTRUCTIONS

1. Shareholders desirous of withdrawing their acceptances tendered in the Counter Offer can do so up to November 29, 2003.

2. The withdrawal option can be exercised by submitting the Form of Withdrawal, duly signed and completed, along with the copy of acknowledgement slip issued at the timeof submission of the Form of Acceptance-cum-Acknowledgement.

3. In case of shares held in joint names, names should be filled up in the same order in the Form as the order in which they hold Shares in the Company. This order cannot bechanged or altered nor can any new name be added for the purpose of withdrawing from the Counter Offer.

4. While the Form of Withdrawal can be submitted at any Collection Centre, it would be advisable to send it directly to the Registrar to the Counter Offer.

Location Collection Contact Mode of Phone Nos. Fax Nos. TimingsCentres Person Delivery

Mumbai Computech Sharecap Mr. Patrick Butelho �Hand Delivery 022 � 2267 1824 022 � 2267 0380 Mon-Sat: 11.00 amLimited Ms. Shaila Borkar �Registered Post 022 � 2267 1825 to 5.30 pm147 Mahatma Gandhi 022 � 2267 1826Road, 3

rd Floor

Opp. Jehangir Art GalleryFort, Mumbai � 400023

Mumbai Corporation Bank � Mr. B. Nagaraj Shenoy �Hand Delivery 022 � 2284 1406 022 � 2284 3823 Mon-Fri: 10.00 amCapital Market Branch to 5.00 pmNariman Bhavan, IV Floor Sat: 10.00 am toNariman Point 2.00 pmMumbai � 400021

Bangalore Corporation Bank Mr. A. Ramdas Prabhu �Hand Delivery 080 � 221 8225 080 � 227 4157 Mon-Fri: 10.00 amNo. 14/3, N. T. Road 080 � 221 5491 to 5.00 pmRashtrothana Parishat Sat: 10.00 am toBuilding 2.00 pmBangalore � 560002

New Delhi Corporation Bank Mr. S. P. Bakshi �Hand Delivery 011 � 2341 7547 011 � 2341 8073 Mon-Fri: 10.00 amP.B. No. 162, M41 011 � 2341 4537 to 5.00 pmConnaught Circus Sat: 10.00 am toNew Delhi � 110001 2.00 pm

Kolkata Corporation Bank Mr. Sanjay Bakshi �Hand Delivery 033 � 2242 5668 033 � 2242 5583 Mon-Fri: 10.00 amMookherjee House 033 � 2242 2268 to 5.00 pmI Floor, 17 Sat: 10.00 am toBrabourne Road 2.00 pmP.B. No. GPO 2352Kolkata � 700001

Chennai Corporation Bank Mr. P. S. Baliga �Hand Delivery 044 � 2533 0817 044 � 2534 2339 Mon-Fri: 10.00 am49, Armenian Street 044 � 2534 2085 to 5.00 pmP.B. No. 237, George Town Sat: 10.00 am toChennai � 600001 2.00 pm

PLEASE NOTE THAT NO FORMS SHOULD BE SENT DIRECTLY TO THE ACQUIRERS/PAC OR TO THE MANAGER TO THE OFFER.

Note: All future correspondence, if any, should be addressed to Registrar to the Counter Offer at the following Address:




Opp. Jehangir Art Gallery, Fort, Mumbai � 400023

Tel. No. : 022 � 2267 1824/ 25/ 26 Fax : 022 � 2267 0380




Signed and Delivered FULL NAME(S) ADDRESS SIGNATURE(S)

First/Sole Holder




Place: Date: