Diageo will be selling most of its whisky business Whyte & Mackayas the company fear that continued ownership of the Scottish brand will cause prices to rise.
The sale offer comes after retailers complained to the Office of Fair Trading (OFT) that Diageo's acquisition of United Spirits last year resulted in two of the UK's leading blended bottled whisky brands coming under the same owner.
Following a four-month investigation, the OFT said it found that the merger "may lead to a substantial lessening of competition in the supply of blended whisky to retailers". The body flagged that Diageo's Bell's whisky brand and W&M's own-label and branded blended whisky are competitors in the UK retail sector.
The recent move covers all of Whyte & Mackay's blended Scotch whisky brands along with its private label operations. Whyte & Mackay will retain its malt distilleries at Jura and Fettercairn and the Invergordon grain distillery.
In the UK, United Spirits' subsidiary, Whyte & Mackay, also owns and distributes other spirits such as Black Dog and Blue Ribrand.
