LONDON, July 4 Global drinks firm Diageo said on Thursday it had acquired a 25 percent stake in India's United Spirits, considerably less than the London-listed firm had originally hoped for.
In November, Diageo said it was buying 27.4 percent of United Spirits directly from the Indian group, which is controlled by tycoon Vijay Mallya.
It also launched a mandatory offer for another 26 percent on the open market.
But some lenders refused to release security over 3.5 million shares held by the United Spirits benefit trust, equivalent to a shareholding of around 2.4 percent, Diageo said.
And its open offer largely failed, with the company acquiring only a small fraction of shares in this way, after Diageo decided not to lift its offer price despite a surge in the value of United Sprits shares earlier this year.
Diageo said it would now begin to implement its own operational and governance standards at United Spirits, but that this could involve greater management time, costs and resources than originally expected.
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For years Indian businesses have lobbied for a nationwide sales tax, hoping to replace a chaotic structure that inflates costs and halts their trucks at state borders for duty payments, and to unify the country into one of the world's largest single markets. But after political compromises that finally got a goods and services tax (GST) bill before parliament, they have turned wary. Full Article