Dive Brief:
- Diageo is moving to secure its control of United Spirits and to limit the power of the man who previously ran it.
- Diageo has revoked the ability of India's United Breweries Holdings Ltd to appoint an independent director to United Spirits' board. United Breweries, run by billionaire Vijay Mallya, controlled United Spirits until Diageo acquired a majority stake in July.
- Mallya will retain his title as non-executive director and chairman.
Dive Insight:
Diageo worked hard to acquire United Spirits. The world's largest distiller now owns India's largest distiller — but the deal took months and months and nearly $2 billion to happen. That alone would be reason enough for Diageo to try to consolidate its power now that the deal is complete.
But the fact that Vijay Mallya ran United Spirits previously, and not some other billionaire, forced Diageo's hand. Mallya, now billions of dollars in debt and operating under a cloud, is not Diageo's idea of a leader.