Today’s news that India’s Venkateshwara Hatcheries(VH) has bought the Blackburn Rovers is another milestone for the innovative Indian group. Being the first Indian Owner of a English Premier League (EPL) club is certainly interesting for a company that many in India would associate with being the first to scientifically rear Chickens!!! Not that the Government run research institutes did not do this part of their raison d’être. Venkys was the first commercially successful one and many farmers still swear by their hatchlings.
Why would anyone operating in this industry in India want to be associated with English Football? The answer is strange and yet simple. Anuradha Desai,CEO of VH has been quoted as saying that football would provide a linkage for their global ambitions. It will provide a global reach to markets where they do not currently have access or they cannot compete with their existing suite of products. The group has been integrated vertically in the eggs and chicken business by opening restaurants as well as setting up research facilities to breed better chickens. VH has also diversified into unrelated activities like films, wine retailing, biscuit sales, pet foods and even disinfectants. Some of these forays have failed spectacularly too.
However in their core business, VH’s international strategy seems well thought out. They have tried to source products from several low cost nations like Bangladesh and also have tried to build market share in Africa and the Middle East. But today’s move is radical indeed! Want to use the EPL to launch a European base for future operations? You would have thought running a football club is a different ball game- a tricky one with no relation to the core business. If the Indian newspaper- the Economic times is right, the only possible link is the friendship a VH director has with the Bollywood actor, Sanjay Dutt. Football you see is also entertainment!
Time will tell if this was a right strategy – radical thinking out of the box sometimes does help in Internationalisation. Think NOKIA and the radical shift from Paper to Mobile phones, eh? Will this add more value to the firm or will it be like VH’s other forays and be a £46M loss making move? The answer might blow in the wind sometime in the future.