Diageo and United Spirits on brink of deal

Diageo and United Spirits are reportedly on the verge of signing a US$2 billion deal.

The deal could see the drinks giant pick up a 51% stake in Vijay Mallya’s struggling company.

Mallya first fell into difficulties in March when his Kingfisher Airline was grounded, in debt to the tune of US$1.3bn.

Since then his difficulties have mounted and he looked to reduce his share in Whyte & Mackay which, in early autumn, led to rumours that Diageo was looking to buy into the company, something that was confirmed later in September.

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However, the talks had appeared to have broken down causing share prices to plummet and adding to Mallya’s woes.

Times of India reported that a deal could be announced this week and the news has buoyed share prices, which rose 3.09% to 1,257.30 rupees on the Bombay Stock Exchange.