Diageo Now World’s Undisputed Biggest Spirits Producer by Volume

The apparently successful tender for a further 26% of UB Group’s United Spirits operations, giving it a majority 55% stake in the world’s third biggest spirits producer by volume, gives Diageo an unassailable position as the world’s leading spirits producer by volume. Based on 2013 volumes Diageo will have over 9% of global spirits volumes and nearly 2 billion litres in volumes.

As can be seen from the chart below, it will also become the leading player globally in whiskies and rum and further strengthen its lead in vodka.


Source: Euromonitor International

The key benefit for Diageo will be the access to United Spirits unrivalled distribution network and knowledge. In a country, where in effect each of the different 27 states is a different country. However the acquisition is not without its challenges for Diageo, the latest example of which has been the numerous postponements of the publication of United Spirits annual results.

The offer once completed, will also completely change its geographic profile, almost reversing its mature vs emerging market geographic spread it had in 2008 in spirits in volume terms. Although this will not be matched in value terms due to the low value of United Spirits’ spirits brands.


Source: Euromonitor International

This transformation has come primarily through acquisition of which United Spirits is the latest, following Mey Icki of Turkey and Ypióca of Brazil, but also organic growth through greater focus and emphasis on those markets