Diageo confirms talks with United Spirits

Diageo has entered into exclusive talks with India’s United Spirits over a possible collaboration, following weeks of speculation that the drinks giant is interested in taking stake in a company that owns more than half of the Indian beer and spirits market.

It has been reported that Diageo may take a stake in United Spirits, which is controlled by Vijay Mallya (pictured) through his United Breweries Group.

Diageo and United Spirits, the world’s third largest spirits maker by volume, today (November 13) confirmed that talks have taken place. It follows speculation that Diageo wants to secure a deal with United Spirits as the maker of Johnnie Walker whisky and Smirnoff vodka and is keen to increase its presence in India’s fast-growing drinks market.

Speaking exclusively to Marketing Week earlier this month, Mallya refused to rule out the speculation (MW November 5). Mallya, who bought whisky company Whyte & Mackay for £595m last May, also said that United Spirits was on course to “outsell” Diageo, the second largest spirits company in the world.

United Spirits says that it is in “exclusive discussions with [Diageo] for a limited period”. It is thought that Diageo is looking to buy a minority stake of 14.99% initially.

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