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E-Malt.com News article: India: United Spirits rises on Bombay Stock Exchange after reports of Diageo planning stake increase

United Spirits rose 4.6% to Rs 2,468.65 on May 3 on BSE after reports Diageo Plc is considering raising stake in the liquor maker to 72% from 54.78%, Business Standard said.

Meanwhile, the BSE Sensex was down 172.59 points, or 0.68%, to 25,264.38.

Diageo is reportedly exploring various options, including open market transactions to raise its stake in United Spirits (USL). Diageo gained complete control of the board of United Spirits post the exit of Dr Vijay Mallya from his position as chairman and non-executive director of the company in February this year, but seeks to protect its shareholding by hiking stake. Diageo in July 2014 had acquired 26% stake in USL by way of tender offer. As per an agreement reached between Diageo and the UB group in November 2012, Diageo agreed to acquire a 27.4% stake in United Spirits - partly by acquiring shares directly from the promoter entities of the United Breweries group and partly by way of subscribing to a preferential share issue of United Spirits. The agreement triggered a mandatory open offer from Diageo to acquire additional 26% shares in United Spirits as per the Securities & Exchange Board of India's takeover norms.

Net profit of United Spirits declined 45.2% to Rs 40.95 crore on 22.87% rise in net sales to Rs 2638.09 crore in Q3 December 2015 over Q3 December 2014.

United Spirits makes alcoholic beverages. It is a subsidiary of British multinational Diageo plc. Relay B.V., an indirect wholly-owned subsidiary of Diageo Plc holds 54.78% stake in United Spirits (as per the shareholding pattern as on 31 March 2016).


04 May, 2016

   
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