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Business News/ Companies / News/  United Spirits exploring potential sale of Whyte and Mackay
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United Spirits exploring potential sale of Whyte and Mackay

The sale is to allay anti-trust concerns raised by UK fair trade regulator after United Spirits's merger with Diageo

The UK’s Office of Fair Trading in November said Diageo had offered to sell a majority of the W&M business after the regulator raised concerns about the impact of the United Spirits deal on UK whisky prices. Photo: Ramesh Pathania/Mint Premium
The UK’s Office of Fair Trading in November said Diageo had offered to sell a majority of the W&M business after the regulator raised concerns about the impact of the United Spirits deal on UK whisky prices. Photo: Ramesh Pathania/Mint

Mumbai: United Spirits Ltd on Thursday said it is planning to initiate a process of selling its UK-based unit Whyte and Mackay Ltd (W&M) to allay anti-trust concerns raised by the UK fair trade regulator as a result of United Spirits’s merger with Diageo Plc.

The UK’s Office of Fair Trading in November said Diageo, which bought a 25.02% controlling stake in United Spirits in July, had offered to sell a majority of the W&M business after the regulator raised concerns about the impact of the United Spirits deal on UK whisky prices.

Diageo’s whisky brands Bell’s, Johnnie Walker and others compete with W&M’s namesake label and other brands, including Jura and Dalmore. Diageo, the world’s biggest distiller, acquired W&M when it bought a stake in United Spirits last year to strengthen its foothold in emerging markets.

In a filing to BSE, United Spirits said its board “proposes to initiate a process, based on the outline timetable provided under UK law in connection with the decision of the Office of Fair Trading, to explore a potential sale of W&M."

“The board has nominated certain person to oversee the process and consider, examine and evaluate possibilities and structures in relation to a potential sale, appoint necessary advisors in this regard and identify potential purchasers," it said without disclosing details.

In November last, Mint had reported that Vivian Imerman, chairman of investment firm Vasari Global and former CEO of W&M, had offered to buy back the business if its current owner United Spirits is forced to sell it to allay the UK regulator’s antitrust concerns as a result of its merger with Diageo.

Imerman had sold W&M to United Spirits for £595 million in 2007.

In a separate development, the United Spirts board has approved the amalgamation of its wholly-owned subsidiaries Tern Distilleries Pvt. Ltd and SW Finance Co. Ltd with itself.

Tern Distilleries was referred to the Board for Industrial and Financial Reconstruction (BIFR) following the erosion of its entire networth.

The amalgamation follows the BIFR declaring Tern a sick industrial company and asking for it to amalgamate with United Spirits.

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Published: 09 Jan 2014, 10:41 AM IST
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