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Diageo pulls out of Stock Spirits auction-sources
April 26, 2011 / 10:12 AM / 7 years ago

Diageo pulls out of Stock Spirits auction-sources

* Sticking point of talks was valuation

* Leaves IPO as most likely option

LONDON, April 26 (Reuters) - Diageo Plc (DGE.L), the world’s biggest spirits group, has pulled out of the sale process for Stock Spirits, one of central Europe’s biggest drinks companies, sources familiar with the matter said on Tuesday.

The main stumbling block was price with Stock Spirits’ owner, the U.S. private equity group Oaktree Capital, said to be looking for a price of around 500 million pounds ($823 million). Diageo’s withdrawal leaves an initial public offering (IPO) the most likely future option, the sources said.

“The issue was very much one of valuation, if the seller’s idea of a price comes down then Diageo may rejoin the sale process,” said one source familiar with the matter.

Diageo had no comment to make on the auction.

Diageo, the maker of Johnnie Walker whisky and Smirnoff vodka, was the main interested trade buyer looking at the UK-headquartered group which makes Czysta de Luxe, an upmarket Polish vodka, and also Stock Prestige vodka. (Reporting by David Jones; Editing by Mark Potter)

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