Blog: Diageo ends United Spirits intrigue
Olly Wehring | 25 August 2009
Diageo has put an end to speculation that it may invest in United Spirits (USL), at least for now.
It has been apparent to just-drinks, as I'm sure it will have been to several others following the situation, that talks between the two companies were not going swimmingly.
There have been suggestions from the Diageo camp that Mallya and co were not that easy to deal with. Sources diplomatically described the progress of talks as "slow" earlier this year, although both Diageo and USL maintained that the dialogue was still open.
Now, the game is up. The main barriers - the size of Diageo's stake and the amount of investment required by USL - have proven insurmountable.
Well, they have for now. On the face of it, some kind of tie-up still looks like a decent bet for the future.
India is one the world's largest countries, with a strongly emerging economy and a growing thirst for spirits. USL controls around two thirds of the market and, as part of Vijay Mallya's UB Group, has the biggest distribution network in the country's drinks sector.
Diageo, as the world's largest spirits firm, naturally wants a piece of that market. Its current joint-venture in India with Radico Khaitan has a spirits market share of around 10% - hardly enough for the world's leading spirits player.
However, exciting as India may be as a market prospect, it is early days. There is plenty of time for round two.
United Spirits, meanwhile, has its short-term sights fixed on securing private equity investment.
The long-running discussions between Diageo and United Spirits over a possible stake purchase have collapsed, with Diageo walking away from the table....
For those people looking to the Red Planet as shining utopia away from all things earth, look away now....
Bacardi's 42 Below vodka brand has found a novel way to use the lemons left over from cocktail-making: Turn them into liquid soap....
Philadelphia’s soda tax came into force on Sunday, and is reportedly causing a stir in the city's check-out aisles....
- Has the politics of M&A changed? - Analysis
- Fruit-flavoured beer? Think of the kids - Comment
- Most Valuable Spirits Brands in 2017 - The facts
- Drinks industry's gender failure - Consumer Trends
- Most Valuable Beer Brands in 2017 - The facts
- Anheuser-Busch readies US executive switches
- Brexit paperwork offers alcohol smuggling opp's
- Asahi’s Peroni Ambra - NPD
- Irish whiskey hails bid to relax distillery sales
- Diageo's Captain Morgan LocoNut - NPD
- Central and East Europe Report Package
- Battle of the Generations - The fight for iGen, Millennial, Gen X and Baby Boomer consumers
- Global vodka insights - market forecasts, product innovation and consumer trends
- The Next Seven Big Beverage Markets
- Global rum insights - market forecasts, product innovation and consumer trends