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Diageo Shares Spike Briefly On Rumor Of Moet Hennessy Stake Sale

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Diageo Shares Spike Briefly On Rumor Of Moet Hennessy Stake Sale
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Diageo plc (NYSE: DEO) shares spiked around 10:30 a.m. following a rumor that LVMH Moet Hennessy Louis Vuitton SE (ADR) (OTC: LVMUY) would move to buy the company's 34 percent stake in Moet Hennessy.

LVMH, the world's largest luxury good provider, sold a portion of its Moet Hennessy wine and spirits unit to Diageo, the world's biggest spirits groups, in the 1990s.

There had been sporadic chatter over the past six years that LVMH would sell off even more of Moet Hennessy, giving Diageo majority or even full ownership, according to multiple sources. Speculation was the the alcohol vendor would be able to effectively integrate Moet Hennessy's own products into its line of top-end spirits.

Talk that Diageo might return its partial ownership to the original holder, therefore, is a departure from the norm.

Of note, Diageo was at the center of another rumor recently -- that Brazilian billionaire Jorge Paulo Lemann was trying to acquire the company via his private equity firm, 3G Capital. This story, however, has yet to develop further.

Diageo last traded up 0.34 percent on Wednesday morning, but briefly traded as high as $118.95 per share.

Posted-In: Diageo plc LVMH Moët Hennessy Louis VuittonNews Rumors Movers Best of Benzinga

 

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