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India's United Spirits surges over 30 percent on Diageo deal
November 12, 2012 / 9:26 AM / in 5 years

India's United Spirits surges over 30 percent on Diageo deal

Bottles of Diageo's Smirnoff Whipped Cream (L) and Fluffed Marshmallow flavored vodkas which were recently launched in the U.S. are seen in this picture taken December 20, 2011. REUTERS/Mike Segar

MUMBAI (Reuters) - United Spirits (UNSP.NS) surged over 30 percent to a more than 4-1/2 year high as investors bet its deal to sell a majority stake to Diageo (DGE.L) would boost the Indian liquor maker’s profitability and reduce its debt levels.

Analysts, including from Morgan Stanley and CLSA, upgraded the stock after the deal, saying the $2.1 billion to sell a 53.4 percent stake to Diageo would substantially benefit United Spirits.

United Spirits rose 31.4 percent to 1,787 rupees as of 4.14 a.m EDT, after earlier hitting a session high at 1,795.80 rupees, its highest since April 2008.

Reporting by Rafael Nam and Abhishek Vishnoi; Editing by Sunil Nair

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