Scottish & Newcastle has been given the go-ahead to up its stake in India's United Breweries Ltd. The country's cabinet yesterday (16 March) approved S&N's proposal to increase its holding to 37.5% from 26%. The transaction will cost S&N around INR7.8bn (US$177m).

In a statement following a cabinet meeting, the government said that Scottish & Newcastle India Private Ltd. can either directly or through any of its overseas units buy the stake in UBL. S&N will increase its stake in the Indian company by purchasing 3.77m new shares at a price of INR575 per equity share, the statement added.

The deal also includes issue of 5.1m warrants convertible into shares at INR575 per share.

S&N will also offer to buy up to 4.32m shares held by minority holders of UBL for the same price to fulfil the regulatory requirements.