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Tuesday, April 26, 2011

Diageo pulls out of Stock Spirits auction -sources, (DGE)

Diageo (DGE.L), the world's biggest spirits group, has pulled out of the sale process for Stock Spirits, one of central Europe's biggest drinks companies, sources familiar with the matter said on Tuesday. Price was the main stumbling block, with the owner of Stock Spirits, U.S. private equity group Oaktree Capital, said to be looking for around 500 million pounds ($823 million). Diageo's withdrawal leaves an initial public offering (IPO) the most likely future option, the sources said. "The issue was very much one of valuation. If the seller's idea of a price comes down then Diageo may rejoin the sale process," said one source familiar with the matter.