Diageo is the world’s largest manufacturer of spirits, and despite efforts over the last four years to get its hands on some more market share in India, it has failed to complete any deal with Vijay Mallya’s United Spirits group.
A deal to acquire some stock would mean that Diageo’s emerging market sales would jump from 40% to 45% as a proportion of the group’s turnover. It is certainly possible that Diageo is in with a better chance of a deal with Mallya now, as he has been scrabbling around for funds to try and keep his Kingfisher Airlines afloat for the last 12 months.
Diageo would have to unload United Spirits’ Whyte & Mackay scotch business to comply with competition laws, but it is still seen as a killer deal if the firm manages to pull it off.
Talks are afoot…watch this space.