Diageo is looking to boost its presence in the Chinese drinks market with a £600m move for spirits group Shui Jing Fang.
The drinks giant said a full offer for the company – in which it already holds a 39.7% stake – would give it a springboard to expand its share of one of the fastest-growing spirits markets in the world.
“Diageo now has a valuable opportunity to build a substantial presence in super-premium Chinese white spirits and it will enable us to bring one of the leading Chinese white spirits brands to international markets," said Diageo chief executive Paul Walsh.
“This is an important and unusual transaction.”
The Guinness brewer, whose spirit brands include Smirnoff vodka and Johnnie Walker, this week agreed to increase its stake in holding company Quanxing and under Chinese takeover rules must now make an offer to buy out other Shui Jing Fang shareholders.
Any deal would be subject to regulatory approval.
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