New Delhi, May 14:

India’s UB Group, the world’s third-largest maker of spirits, is close to signing a $1.3 billion deal to acquire Scottish whisky maker Whyte & Mackay Ltd, a news report stated today.

The deal framework is already in place and formal announcement is imminent, most likely on Wednesday, The Economic Times reported, quoting unnamed persons associated with the transaction.

The final cost of acquisition, which includes a payment to bridge a deficit in the pension trust of Whyte & Mackay, is expected to top 650 million pounds ($1.28 billion), the report stated.

On Saturday, Glasgow-based Whyte & Mackay confirmed that negotiations with the UB Group were at an ‘advanced stage,’ but said that no deal has been reached. The UB Group dominates India’s liquor market. It is the world’s third-largest producer of spirits after Pernod Ricard of France and Diageo of Britain and hopes to become bigger.

UB officials could not be reached for comment. Vijay Mallya, the chairman of the group, has previously said his plans to acquire businesses in Europe were driven by a desire to turn the UB Group into a global player and the changing demands of Indian consumers.

With rising incomes, India’s middle class is increasingly drinking Scotch whisky and wine. The UB Group, which has an airline named after its leading beer brand, Kingfisher, and also has interests in construction, withdrew last year from a bid to buy French champagne maker Taittinger because of opposition from wine growers in the Champagne region.