USL agrees to sell Whyte & Mackay for £430 million

United Spirits Limited (USL) has agreed to sell its British subsidiary Whyte & Mackay to the Philippines-based brandy maker Emperador for £430 million (around $727 million).

The sale was necessitated by British competition regulators after Diageo acquired a 28.78 per cent stake in Indian drinks group USL. However, the sale is subject to regulatory approvals from Indian and British authorities as well as shareholders.

Announcing the board's approval for the sale, the company said, "United Spirits UK has approved the sale and entered into the share sale and purchase agreement with Emperador UK and Emperador. The sale is subject to necessary Indian and UK regulatory approvals and shareholder approvals."

However, the sale is subject to regulatory approvals from Indian and British authorities as well as shareholders.

The sale includes Whyte & Mackay's all five distilleries as well as the company's current debt and its pension benefits. Analysts are of the view that the sale would help in lowering USL's huge debt pile of around Rs 7,579 crore. As of December 2013, around 50 per cent of that debt pile was in the books of USL's British holding company.

USL Chairman Vijay Mallya had purchased Whyte & Mackay for £595 million ($1.2 billion) in 2007, getting access to massive scotch reserves for its blended whiskies.

USL shares gained 0.19 per cent to close at Rs 2,777 on Bombay stock Exchange on Friday.

Business: 
General: