Contrary to the media reports of the almost-shelved talks between United Spirits Ltd's (USL) Chairman Vijay Mallya and world liquor biggie Diageo - involving the sale of 14.9 percent USL stake, and a seat on its board -, Mallya asserted that the talks are on course!

Despite uncertainty looming large on the deal, at least for the present, the USL has maintained its optimism about a fruitful outcome, apparently because Diageo has reiterated its commitment of expanding a business in India - with USL or otherwise. USL is the third-ranking distiller in the world, producing brands like McDowell's No 1, Royal Challenge and Antiquity.

Commenting on the media reports, and a statement by Diageo's Asia Pacific president John Pollaers - indicating that the two companies have not been able to find a "common structure" for the deal to materialize - Mallya said on Friday: "Structuring issues due to anti-trust or monopoly issues are being addressed by the lawyers."

However, sources close to the proceedings have disclosed that the negotiations slowed down largely due to the differences arising out of the terms of valuations. While the stake would have cost Diageo Rs 1,170 crore in November, USL's Friday share price of Rs 667 indicates that the value of the nearly 15 percent stake of the company has now fallen to Rs 1,000 crore!