Business World

Friday 19 July 2019

Shares in Guinness maker Diageo jump on billionaire Lemann takeover talks

The Guinness brewery at St James’s Gate in Dublin.
The Guinness brewery at St James’s Gate in Dublin.

Brazilian billionaire Jorge Paulo Lemann and his partners in private equity firm 3G Capital are considering a potential bid for Diageo PLC, the world's largest producer of spirits, the Brazilian newsweekly Veja reported .

Shares in Diageo gained just under 9pc to £19 at 8:05am on the news.

This was the biggest gain since November 2008 valuing the firm at about £48bn.

Lemann, who is Brazil's richest man, and partners Marcel Telles and Beto Sicupira, are in the initial stages of studying a buyout offer for Diageo, Veja reported in its Radar column, without saying how it obtained the information.

U.S.-listed shares of Diageo jumped 8.7 percent on the report to close at $118.0 (£77.26) in heavy trading, the biggest gain in six and a half years.

Diageo had no immediate comment. Efforts to reach 3G Capital representatives in Rio de Janeiro were not successful.

London-based Diageo produces Guinness as well  as some of the world’s leading beverage brands, including Johnnie Walker whisky, Smirnoff vodka, Tanqueray gin, Don Julio tequila.

Lemann has embarked on a shopping spree in recent years that included buying Burger King from Diageo in 2010 and buying H.J. Heinz Co in 2013 in partnership with U.S. billionaire Warren Buffett.

Harvard-educated Lemann is the chief investor and strategist at 3G Capital. His equity company controlled 65 percent of the Brazilian beer market before embarking abroad to merge with Belgium's Interbrew in 2004 to form InBev, which bought U.S. brewer Anheuser-Busch in 2008.



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