Diageo is expected to write down the value of its stake in the baijiu producer

Diageo is expected to write down the value of its stake in the baijiu producer

Diageo has declined to comment on reports that it is to write down the value of its stake in baijiu brand Shuijingfang.

The Financial Times reported yesterday that the UK-based firm will announce a move to record an impairment in Shuijingfang's value, when it publishes its preliminary full-year results on Thursday. A Diageo spokesperson declined to comment on the report when contacted by just-drinks today.

Last year, Diageo took full ownership of Shuijingfang's controlling shareholder, SJF Holdco, formerly Quanxing Group. As a result, the UK firm has a 39.71% indirect stake in Sichuan Shuijingfang Co, the company behind the brand.

Diageo is among a number of drinks firms to have suffered in China from the Government's anti-extravagance measures. In January, the firm reported a 66% drop in first-half sales for Shuijingfang in the country.

Shuijingfang said last week it expects to make a first-half loss and its chairman has resigned, according to the FT.

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