News Briefs for October 16, 2012October 16, 2012
•Fresh reports say Diageo is in talks to acquire a 20% stake in India’s United Spirits Ltd. (USL). Citing unnamed sources, Bloomberg said negotiations between Diageo and USL—which the two parties acknowledged late last month—are now aimed toward a deal that would give Diageo management control over the Indian spirits giant, whose brands include McDowell’s No. 1 and Bagpiper. The sources said Diageo would likely buy new shares of USL, along with a portion of USL chairman Vijay Mallya’s current 28% stake in the company. Diageo would receive the right to appoint a new USL CEO, while Mallya would remain chairman and keep a 10% stake. If such a deal were to succeed, it could trigger a mandatory open offer by Diageo for a further 26% in the company, the sources said. Earlier reports suggested Diageo was angling for a 25% stake in USL for around $800 million.
•Moët Hennessy saw revenue rise 12% on an organic basis to €2.77 billion ($3.6b) in the nine months through September. The company said an improvement in product mix and price increases announced at the beginning of the year contributed to revenue gains in its Champagne business, which includes the Moët & Chandon, Veuve Clicquot, Krug and Ruinart brands. The group’s Champagne unit recorded increases across all regions with especially strong gains in emerging markets over the first nine months of the year. Hennessy Cognac, meanwhile, “continued to see strong momentum across all categories” during the period.
•Diageo is prepping the launch of two new flavored vodkas under the Smirnoff brand—Smirnoff Iced Cake and Smirnoff Kissed Caramel—ahead of the holiday season. Rolling out at the end of this month and priced at $12.99 a 750-ml., the pair was first unveiled on VH1’s scripted television series Single Ladies. Iced Cake and Kissed Caramel join Smirnoff’s growing stable of confectionary and dessert-focused flavors, which includes the Whipped Cream and Fluffed Marshmallow expressions. Last year, Smirnoff was up 0.5% to 9.6 million cases in the U.S., according to Impact Databank.
•Mario Batali, Lidia and Joe Bastianich, and their partners are opening a second U.S. location of the Italian food and wine marketplace, Eataly, in Chicago. The new Eataly is slated to open in September 2013 in the roughly 60,000-square-foot space that formerly housed the ESPN Zone sports bar and arcade, which shuttered in 2010. Eataly first opened in Turin, Italy, in 2003 before making its U.S. debut in New York City in 2010. The new Chicago venue will be the 20th Eataly worldwide, joining the New York location, as well as others in Italy and Japan. The owners are planning to enter Los Angeles and Istanbul in the near future and have also entered negotiations for a space in São Paulo, Brazil.
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