Diageo, the world’s biggest spirits maker, said yesterday that it would assist the Office of Fair Trading with its evaluation of the United Spirits deal and that a further announcement would be made in due course.
In July Diageo took a 25 per cent stake in United Spirits, part of industrialist Vijay Mallya’s empire and owner of Whyte & Mackay, which sells a branded Scotch whisky but has a bigger business supplying bulk whisky that other drink makers brand as their own.
But the competition authority said that Diageo’s lower-end Bell’s whisky competes with Whyte & Mackay’s own-label and branded whisky and that the merger may lead to “a substantial lessening” of competition.
Diageo has offered to sell Whyte & Mackay’s Invergordon, Jura and Fettercairn grain distilleries, which account for the bulk of its blended Scotch. It would like to keep the smaller Dalmore and Tamnavulin malt distilleries.