Diageo's majority-owned subsidiary United Spirits sells IPL franchise

(Alliance News) - Diageo PLC on Wednesday said its subsidiary United Spirits Ltd has agreed to sell its entire stake in Royal Challengers Sports Pvt Ltd for INR166.6 billion, around GBP1.33 billion.

London-based Diageo operates in over 180 countries with a portfolio of over 200 brands, including top sellers like Johnnie Walker whisky, Smirnoff vodka, Tanqueray gin, and Guinness stout.

The FTSE 100 listing owns a controlling stake of 55.9% in United Spirits which is India's largest beverage alcohol company. It first acquired a stake in 2013, and last increased its holding in February 2020.

The sale, to a consortium comprising Aditya Birla Group, the Times of India Group, Bolt Ventures and Blackstone Inc's perpetual private equity strategy, follows a strategic review launched in November.

At the time, United Spirits Managing Director & Chief Executive Praveen Someshwar said RCSPL has been a "valuable and strategic asset for USL, however it's non-core to our alcobev business."

RCSPL owns and operates the Royal Challengers Bengaluru franchises that participate in the Indian Premier League and Women's Premier League.

On completion, the acquiring consortium will, through its ownership of RCSPL, acquire the rights to own and operate the IPL and the WPL franchises.

Diageo said the transaction remains subject to customary regulatory and legal approvals, including from India's cricket board and competition authorities.

Shares in Diageo rose 1.3% to 1,380.00 pence each in London on Wednesday morning. The wider FTSE 100 was up 1.0%.

By Jeremy Cutler, Alliance News reporter

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