Diageo offer for United Spirits hits rocks amid Indian concerns

DIAGEO’S takeover of Indian drinks company United Spirits is set to be pushed back this week, with regulators in the country yet to approve the next stage of the deal.

The owner of Johnnie Walker and Smirnoff agreed to buy a 27.4 per cent stake in United Spirits from its founders in November.

With that completed, it was set to launch a mandatory open offer to shareholders for another 26 per cent, with the combined offers totalling $2.1bn (£1.3bn).

This offer was supposed to have been made by 18 January, but Indian concerns have pushed this part of the deal back.

The acquisition, which would merge Diageo with the maker of Dalmore and Whyte & Mackay in the world’s biggest whisky market by volume, is being scrutinised by India’s Competition Commission and the country’s Securities and Exchange Board.

It is now believed that the deal may not go through until the second quarter of the year.

Shareholders are due to be updated on the situation at Diageo’s half-year results on Thursday.

The company did not comment.