| LONDON, March 12
LONDON, March 12 United Spirits' Whyte
& Mackay whisky unit has attracted interest from several drinks
makers and private equity firms and is expected to fetch about
350 million pounds ($582 million), according to sources familiar
with the matter.
SPI Group, owner of Stolichnaya vodka, Italy's Campari
and private equity firms Lion Capital and TPG Capital
Management are among the interested parties likely to
have bid, said the sources, who declined to be identified since
the process is private.
The sale was proposed last year by Diageo, the
world's biggest spirits company by revenue, to appease UK
regulators concerned that its purchase of a controlling stake in
United Spirits would hurt competition in the world's No. 3
Scotch market behind France and the United States.
The sources said first-round bids had been due earlier this
week and second-round bids were due next month.
Whyte & Mackay has about 7 percent of Britain's market for
blended Scotch whisky, which combines whiskies often made from
various grains. It also supplies retailers for own-brand
whiskies that account for 18 percent of a market worth $1.74
billion a year, according to researchers IWSR.
Some of the sources expect Whyte & Mackay's sale to fetch
about 350 million pounds, but others said it could sell for much
higher, due in part to a resurgence in consumer demand for brown
Spokespeople for SPI, Campari, Lion and TPG declined to
comment. United Spirits could not be immediately reached for
Diageo, which controls more than 20 percent of the blended
market, originally proposed the sale of most of Whyte & Mackay
but with United Spirits keeping the smaller, single malt
distilleries, Tamnavulin and Dalmore.
But the sources said United Spirits was now accepting bids
on both the originally proposed package and the whole business,
since suitors were more interested in the high-end Dalmore.
Earlier on Wednesday, Italy's Campari announced a deal to
buy Canadian whisky Forty Creek for $167 million. On a
conference call, Campari Chief Executive Bob Kunze-Concewitz
told reporters the company still had about 350 million euros
($485 million) to spend on other acquisitions.
When asked whether Campari was interested in buying Scotch
whisky brands in particular, he said decisions would be based
more on regional footprint rather than type of alcohol. "We're
not driven by category, we're driven by geography," he said.
Former Whyte & Mackay boss Vivian Imerman said in November
that his investment firm, Vasari Global, would also be
interested in buying Whyte & Mackay.
A spokeswoman for Vasari declined to comment.
Whyte & Mackay has earnings before interest, tax,
depreciation and amortisation (EBITDA) of about 22 million
pounds, according to the sources.
They said the majority comes from the bulk whisky business
which could attract a multiple of roughly 10 times EBITDA, with
the remaining portion coming from Dalmore and Tamnavulin, which
would fetch a much higher multiple.
($1 = 0.6014 British Pounds); ($1 = 0.7212 Euros)