(TheDrinksBusiness) - Diageo’s offer to buy a 26% stake in United Spirits (USL), the dominant spirits group in the Indian market, has been rebuffed by shareholders, according to reports from Mumbai.

Diageo offered 1,440 rupees per share, a significant premium to the then market price when the bid was made late last year. Today the share price stands at more than 2,000 rupees and agencies in Mumbai have speculated that Diageo may have won only 65,000 shares when the tender offer for up to 38 million shares closed on Friday. 

Neither company will comment on the outcome of the tender offer, which was one component of a complex £1.2bn deal for Diageo to take control of USL. However, observers suggest that the setback is no obstacle to the takeover being completed, giving the world’s biggest premium spirits group a significant trading advantage in the sub-continent.