Diageo has reached a €1.5 billion deal to take over India’s United Spirits, the culmination of more than three years of painful on-again, off-again negotiations with the mercurial liquor baron, Vijay Mallya. Diageo will pay 1,440 rupees (€20.7) a share for a stake of up to 53.4 per cent in the company.

Mr Mallya, whose father built United Spirits by buying distressed distilleries in the 1960s, will remain as chairman.

He also owns Kingfisher Airlines, which is currently grounded after staff who had not been paid for months refused to work.

The acquisition will give Diageo, the world’s largest whisky distiller, access to United Spirits’ unrivalled distribution network to boost its position in India, which is already the world’s largest consumer of whisky by volume. – Copyright The Financial Times Limited 2012