Carlsberg gets favourable order from Singapore tribunal against its Indian partner

Danish brewing major Carlsberg said it has received a favourable order from an arbitral tribunal in Singapore against CSAPL Holdings Pte Ltd (CSAPLH), its partner in the company operating businesses in India and Nepal.
The Singapore-based tribunal has issued a liability award and did not consent to CSAPLH’s allegation relating to governance and breach of the shareholder’s agreement concerning Carlsberg South Asia Pte Ltd (CSAPL), said Carlsberg in its latest earnings statement this week.
CSAPL is the holding company for the Carlsberg’s businesses in India (100 per cent) and Nepal (90 per cent). In CSAPL, 33.3 per cent shares are owned CSAPLH which is under the control of Singapore resident C P Khetan, and the remaining 67 per cent Carlsberg.
According to Carlsberg, at the request of CSAPLH, the disagreements were referred to arbitration in Singapore.Now a “liability award was issued the arbitration tribunal on May 4, 2022. Carlsberg considers its position to be entirely vindicated the liability award and is very satisfied with this outcome,” said Carlsberg.
The tribunal did not grant CSAPLH the relief it had been seeking based on various allegations relating to governance and breach of the shareholder’s agreement raised in the arbitration and publicly, it said.
“The tribunal found CSAPLH to be in incurable material breach of the shareholder’s agreement. As a remedy for the material breaches committed CSAPLH, the arbitration tribunal awarded Carlsberg the right to call CSAPLH’s shares in CSAPL,” it added.
Under liability award, a participant can demand cash or the employer can choose between cash and stock and establishes a pattern of paying in cash.
“Carlsberg immediately invoked its right to begin the call process, and CSAPLH subsequently exercised its put option under the shareholder’s agreement,” the earnings statement said.
Earlier in February this year, while declaring the financial statement for 2021, Carlsberg had said that the Carlsberg Group has had serious disagreements with its partner for some time.
According to the shareholder’s agreement, the partner was granted a put option to sell his shares to Carlsberg, it added.
“The shareholder’s agreement states that the put option window ends in late 2023, although the Group disputes the partner’s right to exercise the put option,” it had said.
Carlsberg Group commenced operations in India in 2007 with the beginning of production at a brewery in Paonta Sahib, Himachal Pradesh.