To get the necessary approval from the fair-trade regulator and clear any doubts regarding their $2-billion deal, the executives of United Spirits (USL) and Diageo met senior officials of the Competition Commission of India (CCI) on Monday. Both parties are said to have discussed the nuances imbedded in the Diageo-USL deal announced on November 9, 2012.
As reported, CCI is said to have expressed concerns about the structuring of the R11,166-crore Diageo-United Spirits deal. As per the law, all mergers and acquisitions cases require the approval from the CCI. Sources said the clauses that require more clarity pertain to the sale of additional shares by United Breweries Holding (UBHL) to Diageo in case the preferential allotment by UBHL to Diageo is not successful or is not approved by the USL shareholders. Also, a clause which states that UBHL will vote if remaining shareholding in USL to Diageo in case it fails to get a majority stake in USL even after share purchase, preferential allotment and tender offer, sources said. ?The talks were regarding the deal and related issues,? a source said.
USL and UK liquor major Diageo have proposed a $2-billion transaction that would see the British entity picking a majority stake in the Vijay Mallya group firm.
