Diageo bids for control of India's United Spirits whisky giant
Tuesday 15 April 2014
Drinks giant Diageo is set to launch a new multi-million pound bid in its quest to gain control of India’s United Spirits.
The Guinness and Johnnie Walker owner has bid 114 billion rupees (£1.1 billion) to up its stake to close to 55% in the group and grab a bigger slice of India’s growing drinks market.
Diageo first bought shares in 2012 from owner Vijay Mallya, although the deal was complicated as Mallya’s shares were caught up in his loss-making Kingfisher Airlines business.
Last year Diageo’s tender offer to buy a majority stake failed, as the 1440-rupees-a-share offer price was lower than the market price of shares, only managing to slightly up its stake. This time Diageo is offering to buy a further 26% stake at 3030 rupees a share — a premium of 18.5% to their last closing price.
Diageo, the world’s largest drinks company, began its approach on Bangalore-based United Spirits in 2012 and Indian-born Diageo chief executive Ivan Menezes continued its plan to gain control when he took over last year from Paul Walsh.
There is huge growth potential for India’s whisky market, which is part of Diageo’s strategy to increase sales in the faster-growth emerging markets. In the UK, Diageo has offered to sell most of United’s Whyte & Mackay business to ease competition concerns in the whisky market from the UK Office of Fair Trading. Potential bidders include private-equity groups Lion Capital and KKR.
Meanwhile, beer behemoth SABMiller said today it is “reviewing options” and may sell its $1.04 billion (£622 million) stake in hotel and casino operator Tsogo Sun.
The brewing group reported a 3% rise in full-year sales with volumes up 2% but it missed analyst forecasts. The Peroni producer has been trying to offset slowing European and US sales for better growth in emerging markets but said its full-year results will be in line with expectations.
Chief executive Alan Clark said: “Despite a number of headwinds and a challenging fourth quarter, we continued to deliver top line growth for the year.”
- 1 Saudi Arabia mosque bombing: Two volunteer security guards hailed as heroes for stopping Isis suicide bomber reaching worshippers
- 2 Maisie Williams has an excellent message for one confused fan
- 3 Puerto Rico, island of lost dreams: People are leaving the debt-hit territory in droves as near neighbour Cuba's star rises
- 4 Tampon tax scrapped in Canada after petition convinces conservative government
- 5 Kate Moss on the naked Calvin Klein shoot and the obsession that ended her relationship
Saudi Arabia mosque bombing: Two volunteer security guards hailed as heroes for stopping Isis suicide bomber reaching worshippers
Maisie Williams has an excellent message for one confused fan
Archaeologists discover 2,400-year-old gold bongs in Russia
Tampon tax scrapped in Canada after petition convinces conservative government
Migrants in Kos: Photos show real tragedy after British tourists complain of 'awkward' holidays
EU referendum: David Cameron's rules are a 'democratic disgrace', says French-born Scottish politician set to be denied a vote
British tourists complain that impoverished boat migrants are making holidays 'awkward' in Kos
A nation of inequality: How the UK is failing to feed its most vulnerable people
Australian man punched in the face for defending Muslim women from abuse on train
EU referendum: David Cameron to deny EU migrants and under-18s the chance to vote
David Starkey 'tells Amal Clooney to shut up and stop over-promoting human rights'
iJobs Money & Business
£30 - 35k: Guru Careers: We are seeking a Pricing Analyst to join a leading e-...
£20000 - £25000 per annum + OTE £45K YR1: SThree: At SThree, we like to be dif...
£20000 - £25000 per annum + competitive: SThree: Did you know? SThree is a mul...
£55 - 65k (DOE): Guru Careers: A unique opportunity for a permanent C# Develop...