There have been reports in the Indian press that Diageo is in negotiations with Vijay Mallya to take a stake in his United Spirits group, which owns Whyte & MacKay.
Although Diageo is the world’s largest spirit company by value, United Spirits is largest in terms of volume – particularly in India, where Diageo is keen to build its presence.
Financial problems have been well publicised at the billionaire tycoon’s companies in the last year or so, particularly his Kingfisher Airlines, and there have been rumours that United was considering selling off Whyte & MacKay.
According to a report in the Economic Times of India, Diageo has appointed investment bankers JM Financial to negotiate on their behalf, but Mallya has been keen to quash the rumours.
Mallya told them: “Diageo and ourselves are in constant touch with each other exploring joint business opportunities in this rapidly evolving market. In specific response to your query, we are not in any discussion with JM Financial. There is no question of selling our stakes in our core businesses to invest further or to repay debt in any business, including Kingfisher Airlines. We have other opportunities to access the necessary funding.”