SEBI grants Diageo request on United Spirits offer
11 Feb 2013
The Securities & Exchange Board of India has granted global liquor giant Diageo Plc more time to pay for shares acquired in United Spirits through its mandatory open offer, acceding to the company's request.
Diageo is on the point of receiving all regulatory approvals for the takeover of a majority stake in the company, a part of Vijay Mallya's United Breweries Group. The deal is worth about $2 billion.
While granting its approval to the request, SEBI said that UK-based Diageo will have to pay an interest of 10 per cent per annum for the period of delay in payment to the public shareholders tendering their shares in the open offer.
The revised schedule would be announced in due course after all the regulatory approvals are received, Diageo's manager for the open offer, JM Financial, said in a notice to shareholders on Saturday.
On 31 January SEBI had cleared an open offer by Diageo for purchase of 26-per cent stake in USL. However, the deal is yet to be cleared by the Competition Commission of India, the fair trade overseer.
JM Financial had requested SEBI that the tendering period should be allowed to commence within 12 days of receipt of all applicable statutory approvals.
Sebi has accepted the request with a condition of additional interest payment for the delay and Diageo would announce the revised schedule in due course.
As part of the deal for purchase of 53.4-per cent stake in Vijay Mallya-led UB group's United Spirits Ltd worth over Rs 11,167 crore, Diageo has made aRs 5,441 crore open offer for shares in the company from non-promoter shareholders.
