The Lalit Khaitan-managed Radico Khaitan is set to float an equal joint venture with the world's largest drinks company, Diageo, for a block of Asian markets, including India, The Economic Times has reported today quoting informed sources. RKL, India's second largest spirits company, via its overseas subsidiary Radico Global, is in talks with Diageo to tap opportunities in the Asian markets.

The deal will help Diageo to enhance its market presence in India , arguably the fastest growing spirits market in the world. This will mark Diageo's first major move in India, and in this part of the world, after selling its Indian Made Foreign Liquor (IMFL) assets in 2002.

A Diageo spokesperson refused to comment on the "speculation." An RKL representative said, "Radico Khaitan is constantly looking out for suitable acquisitions and JV targets ... . To this end it has mandated Rabo India Securities as its strategic adviser to identify such opportunities and will seriously consider all such options recommended."

Radico is a distant second with 12.5m cases (of 9 litres each), compared with the Vijay Mallya-owned UB Group's 60m cases (in an overall market estimated at 130-134m cases) after the latter acquired Shaw Wallace last year.