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UK: OFT report stresses Diageo deal concerns

By  |  February 6, 2014

The UK’s Office of Fair Trading has released its report outlining competition concerns of spirits giant Diageo and its planned buyout of India-based rival United Spirits, less than three months after the authority decided to look into the deal.

The $2 billion deal sees Diageo acquiring United Spirits, but Diageo has reportedly offered to divest the majority of United business Whyte & Mackay to quell competition concerns.

The OFT decided last November to review the merger again following the concessions offer.

But in a 53-page report, the OFT has reportedly addressed concerns raised by competitors “that the parties would restrict the supply and/or increase prices of private label blended Scotch whisky,” the regulator wrote.

While other jurisdictions have cleared the merger, the OFT remains unconvinced that the UK whisky market would remain competitive following the acquisition.

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