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Guinness owner Diageo's shares soar amid takeover reports

Published 08/06/2015

Guinness owner Diageo's shares have jumped amid a possible takeover bid
Guinness owner Diageo's shares have jumped amid a possible takeover bid

Guinness owner Diageo's shares have jumped amid a possible takeover bid.

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 9% to £19 early yesterday morning on word of 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% on the report to close at $118 (£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 HJ 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% of the Brazilian beer market before embarking abroad to merge with Belgium's Interbrew in 2004 to form InBev, which bought US brewer Anheuser-Busch in 2008.

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