INDIA: Diageo, United Spirits talks conclude
Announcing the move ahead of its full-year results later this week, Diageo confirmed today (25 August) that the two companies had reached loggerheads over the cost of a stake buy in United Spirits.
"Diageo has today announced that the talks which had been taking place with United Spirits, and aimed at finding a mutually beneficial arrangement for the future of both businesses in the India market, have been concluded," a spokesperson for Diageo said.
"It has not proved possible for Diageo to resolve points of difference between the two parties, principally valuation, and Diageo has made the decision to pursue the potential it sees for its brands in India separately from United Spirits."
Earlier this month, United Spirits told just-drinks that it was closing in on fresh investment. A United Spirits source previously said that the group, which constitutes two thirds of India's spirits market, was in talks with major private equity groups.
just-drinks understands that the talks between Diageo and United Spirits considered a variety of possible partnerships, ranging from Diageo acquiring a 15% stake to joint-control.
Three years ago, Diageo teamed up with Indian spirits group Radico Khaitan, to form a 50:50 joint venture to "exploit the large and developing Indian made foreign liquor (IMFL) segment", the companies said at the time.
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