Diageo Surges On Report That Brazilian Billionaire May Bid
Diageo Plc, the liquor giant that owns Guinness, Johnnie Walker and Ketel One, has surged the most in almost seven years in U.S. trading on a report that Brazilian billionaire Jorge Paulo Lemann is considering a takeover bid.
Lemann and other executives are in early stages of mulling an acquisition, according to Veja columnist Lauro Jardim. A spokeswoman in Brazil for Lemann declined to comment.
The American depositary receipts jumped 8 per cent to $118, the biggest one-day gain since October 2008. They had been down 4.2 per cent this year through Thursday’s close.
Lemann’s company, 3G Capital, has used a series of transactions to expand its stable of household names - often working with Warren Buffett’s Berkshire Hathaway Inc. The private-equity firm orchestrated a deal last year to combine Burger King Worldwide Inc. with Tim Hortons Inc., a coffee-and-doughnut chain. It previously teamed up with Berkshire to acquire H.J. Heinz and is now merging that company with Kraft Foods Group Inc.
Lemann and his partners also have profited from consolidation in the alcoholic beverage industry. They combined Latin American brewers, then engineered an $11 billion merger with Belgium’s Interbrew NV in 2004. In 2008, they led the $52 billion union with Anheuser-Busch Cos. to form the world’s largest beer manufacturer.
Diageo, based in London, has a market value of about 44 billion pounds ($68 billion). Buffett didn’t immediately return a message seeking comment left with an assistant.
News by Bloomberg, edited by ESM