Lord Karan Bilimoria, the founder of Cobra Beer, has announced his decision to step down as chairman, marking the end of an era for the iconic brand.
The move comes after Bilimoria has reportedly repaid nearly all of the creditors impacted by the company's financial collapse over a decade ago.
Cobra, established by Bilimoria in 1989, faced a dramatic downturn in 2009, entering administration with debts of over £70 million owed to 340 creditors. In a bid to rescue the business, Bilimoria partnered with American brewing giant Molson Coors – producer of brands such as Carling, Doom Bar, and Blue Moon – in a controversial pre-pack administration.
This strategy allowed the formation of a joint venture where Bilimoria retained a 49.9 per cent stake and assumed the role of chairman.
Initially set up for ten years, the joint venture was extended in May 2019. Throughout this period, Bilimoria remained committed to his pledge of repaying creditors through his share of dividend payments. While in 2019 he reiterated his determination to fulfil this promise, it did not include some investors who had insurance coverage against Cobra's insolvency.
The businessman has now paid back 99 per cent of the £72 million the business owed to creditors, according to CityAM. Billimoria said that Cobra’s robust profits over the past 15 years had allowed him to “settle the creditors and eventually, now at the exit, also be able to look after special people, including my former shareholders”.
He added that the payback to creditors “leaves Cobra Beer with a superb legacy” as well as a “future as one of the most successful beer brands in the world”.
Molson Coors, said: “We’re excited to take full ownership of the brand and look forward to continuing to work with Lord Bilimoria, founder of the Cobra brand, to champion the brand and the wider beer and hospitality industry.”
Bilimoria, who moved to Britain from India when he was 19, came up with the idea for Cobra while studying law at Cambridge. He wanted to design a brand that would be easier to drink with food. After contracting a brewery in India to develop his beer, the first crates of Cobra were shipped out to Britain in June 1990.
