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Diageo Plc, the world's largest maker of alcoholic drinks has ended talks to buy the world's biggest tequila brand Jose Cuervo from Mexico's Beckmann family. The talks, which went on for over a year, has led to scrapping a 26-year-old distribution agreement set to expire in June 2013, where Diageo has sold Cuervo outside of Mexico. The collapse of discussions and ending the distribution deal led to Diaego's market value falling yesterday by £750 million. According to some media reports, the two sides failed to agree on a price for the brand, which analysts had valued at about $2-billion (£1.2 billion). Paul Walsh, CEO of Diageo, said in a statement that the future of Cuervo ''would be best delivered by aligning ownership of the brand with its route to market, and I have no doubt that Diageo has the best route to market for this brand. However, it has not been possible to agree a transaction which delivers value for Diageo's shareholders.'' Diageo has been distributing Cuervo outside Mexico since 1986, which accounted for about 3 per cent or or about £300 million ($481 million) of Diageo's group sales.
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