Diageo to Acquire Control of United National Breweries

Diageo to acquire control of United National Breweries' traditional sorghum beer business in South Africa by acquiring the remaining 50% interest which it did not already own. On 28 January 2013, Diageo announced it had entered into an agreement to acquire a 50% interest in the company which owns United National Breweries' traditional sorghum beer business in South Africa with the remaining 50% being held by Pestello Investments Inc., a company affiliated to Dr Vijay Mallya. Diageo today announced that it has entered into an agreement to acquire the remaining 50% interest in the company, thereby making it a wholly owned subsidiary of Diageo. Diageo will acquire this further interest from Pestello Investments Inc. for an initial payment of $22 million (approximately £14.8 million) and a potential earn-out payment of up to $14 million (approximately £9.4 million). The transaction is conditional on (among other things) consent from the South African competition authority and is expected to complete in this fiscal year. Once completed, this transaction will give Diageo control of the leading traditional sorghum beer business in South Africa, including the ability to make investment decisions to support the continued growth of United National Breweries' brands in the sorghum beer category.