Strong biz to become stronger: Ivan M Menezes

Interview with Chief Operating Officer, Diageo

Ivan M Menezes, Chief Operating Officer - Diageo, played a key role in the landmark transaction with United Spirits. Expected to lead Diageo, he has been a friend of Vijay Mallya, and the rapport did play a crucial role in finalising the transaction, discussions of which had started six years before. In a call with the Indian media, Menezes explained what it meant for Diageo. Edited excerpts

The deal took quite a while to close. But, finally, you have achieved it. How does this change the fortunes of Diageo in India?
We are pretty much excited about opportunities in the emerging global markets. Given the kind of growth the Indian market is witnessing for alcohol beverages, it could well be the largest market for us in the foreseeable future, from the current position of the second largest after the United States. We are entering into this partnership to make a strong business even more stronger.

What are the key elements you intend to bring to the table for United Spirits and to the Indian market?
United Spirits is a very strong player in the $6-billion spirits market, growing at 15 per cent annually. There is rapid premiumisation.

What we bring to the table is the strength of our marketing, innovation and drive towards premiumisation, in addition to our strong balance sheet to invest. This deal will dramatically transform our position in India.

Before this deal, you had an independent company in India. With USL under your control, would you want to integrate the two?
Our first priority is to first get the requisite regulatory approvals.

As we see now, we will not be integrating the two entities in India and, at a later stage, depending on the business needs, we will take a call on that issue.

There has been intense speculation that Diageo will get to run the company with their own people while Mallya will continue to be the chairman. Have you decided on the Board composition and the management changes you will be undertaking?
We are pretty much aware that United Spirits has built a strong management structure which has been successful. We do not intend to change that. Regarding the Board composition, we are yet to take a call on that and we will visit that at an appropriate time.