Exclusive: Cobra Beer founder Karan Bilimoria steps down as chairman
Lord Bilimoria isn’t shy about discussing his proudest achievements – especially when it comes to the premium lager brand, Cobra Beer.
Today, however, the 63-year-old entrepreneur is recalling those moments with a touch more nostalgia, as he reveals exclusively to City PM he’s officially stepped down from his role as the company’s chairman.
He says he’s going out on a high note. Billimoria tells City PM he has paid 99 per cent of the £72m his business owed to creditors when it was snapped up in a pre-pack administration deal by American brewing giant, Molson Coors, in 2009.
“It leaves Cobra Beer with a superb legacy [and] an entrepreneurial story, which I’m very proud of, and a future as one of the most successful beer brands in the world,” Bilimoria says.
The rise of Cobra Beer
Founded in 1989, Cobra Beer has become one of the best-known beer brands in the country, now stocked in over 6,600 UK restaurants, supermarkets, and independent shops.
The brand managed to grow 40 per cent year-on-year during the first 18 years of business, Bilimoria says, until the financial crisis hit in 2008 and the company found itself struggling to survive.
“To achieve that growth, we had to invest in marketing and sales and growing the business and increasing the volumes,” Bilimoria adds.
“We did that very successfully, but as a result, we made losses… and that required debt to finance it, and that is when the financial crisis hit us.”
The business was saved from administration in a restructuring deal by Molson Coors, which has held a majority stake in the firm since 2009.
However, the deal left creditors £72m out of pocket, which Bilimoria has vowed to pay back ever since.
“The focus has [since] been on having very robust, healthy profits, which we’ve been able to achieve over the 15 years,” he says.
“It is [thanks to] the strong dividends from those profits that I’ve been able to settle the creditors and eventually, now at the exit, also be able to look after special people, including my former shareholders.”
A life in business
Cobra Beer was formed from a simple consumer frustration, like most great entrepreneurial tales, when Bilimoria saw a need for a beer that was less gassy than lager but not as heavy as ale.
Bilimoria had moved to the UK from his home in India at the age of 19 to study for a law degree at Cambridge University, but quickly found a knack for supporting – and leading – the growth of businesses.
Despite a heavy pocket of student debt, Bilimoria thought launching Cobra Beer seemed to be a no-brainer at the time.
“In many ways, this is a story of the British dream where an immigrant comes across [the world] as a 19-year-old to study and builds from scratch – against the odds – a household name,” Bilimoria says.
In many ways, this is a story of the British dream where an immigrant comes across [the world] as a 19-year-old to study and builds from scratch – against the odds – a household name.
“Not just a household name, a multiple-award winning household name with over 150 gold medals… literally establishing it as one of the best beers in the world,” he adds.
His exit from the business, however, will not result in the end of championing the growth and potential of enterprise.
Earlier this month, Bilimoria was appointed chair of the International Chamber of Commerce United Kingdom (ICC United Kingdom), where he plans to strengthen the UK’s engagement on international trade and industrial strategies.
He plans to also continue working closely with the government, as he did while serving as vice president of the CBI in recent years, to ensure businesses across the country can navigate what seems to be “one challenge after another.”
“I think the whole business community feels very let down by the Budget… I just hope they [the government] listen to business, because business is ready to work with government,” he adds.