UB Group’s stake sale to UK-based Diageo Plc seems to have hit a roadblock with the Competition Commission of India seeking additional information on the deal.

Sources said that CCI has found certain clauses of the deal to be based on probabilities and not definitive in nature.

Liquor major Diageo had announced a deal on November 9, under which it agreed to acquire up to 53.4 per cent stake in United Spirits Ltd (USL) for an aggregate amount of Rs 11,166.6 crore.

As part of the deal, Diageo would acquire 27.4 per cent stake for Rs 5,725.4 crore through a combination of share purchase from existing promoters and preferential allotment of shares in USL.

In addition, it will acquire further 26 per cent stake for Rs 5,441.07 crore through open offer.

Liquor major Diageo owns brands such as Johnnie Walker whiskey and Smirnoff vodka, while USL, the country’s largest spirits company, is part of Vijay Mallya-led UB Group.

The commission said it needs clarity on the deal terms which says that existing promoters of USL give a preferential treatment to Diageo, if it fails to get the required number of shares from public shareholders through an open offer. CCI nod is mandatory for all mergers and acquisitions.

The anti-trust regulator has asked the companies to rework the ambiguous parts and make the deal more definitive in nature, sources said. They added that CCI might even send back the application, if the companies fail to satisfy its concerns.

Earlier, the Securities and Exchange Board of India had also expressed reservations about the preferential allotment of shares to acquirers if the open offer fails to elicit desired response from non-promoter shareholders.

bindu.menon@thehindu.co.in

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