Diageo has admitted that it is under investigation from the South Korean government but has refuted claims that the probe concerns tax evasion.

The UK drinks giant said today (27 March) that its local business unit is "fully co-operating" with the South Korean authorities.

However, the company declined to comment further. "We can confirm that Diageo Korea is under investigation but we cannot comment on specific government investigations," Diageo said.

Reports in Korea today claimed that South Korea's tax investigators were investigating Diageo - an allegation the company, which leads the country's Scotch whisky category, hotly denies.

Diageo has enjoyed strong sales in South Korea in recent months. Although Diageo refuses to disclose sales figures on a market-by-market basis, last month the company said it had strengthened its leadership of the whisky sector in South Korea during the six months to 31 December.

Meanwhile, Diageo earlier this month appointed a new head for its business in South Korea. JongWoo Kim, who joined Diageo last year as commercial director in Asia, was named managing director, replacing replaces Duck Song, who passed away earlier this month.