Acquisition

Diageo PLC
19 November 2004

                                                                19 November 2004

DIAGEO ANNOUNCES AGREEMENT TO ACQUIRE URSUS VODKA

HOLDING N.V.

Diageo plc today announces that it has reached an agreement to acquire Ursus
Vodka Holding N.V., the owner of the Ursus vodka and Ursus Roter brands. The
agreement is conditional on anti-trust clearances including clearance in Greece,
the largest volume market for the Ursus vodka and Ursus Roter brands.

Diageo's total cash investment will be approximately €145 million in respect of
the acquisition of the brands and the termination of certain existing production
and distribution agreements related to the acquired brands. The acquisition is
expected to deliver a return in excess of Diageo's weighted average cost of
capital of 9% for investment projects in the first full year of ownership.

Commenting on the acquisition, Andrew Morgan President Diageo Europe said, 'The
acquisition of the Ursus vodka and Ursus Roter brands adds in excess of 400k
cases to our business in Europe and we expect it to enhance the growth profile
of Diageo's business in Greece. Additionally, Ursus Roter as a mid proof
flavoured spirit offers opportunities for growth in the rest of Europe.'


                                     -ENDS-

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Notes to Editor

Diageo is the world's leading premium drinks business. With its global vision,
and local marketing focus, Diageo brings to consumers an outstanding collection
of beverage alcohol brands across the spirits, wine and beer categories
including Smirnoff, Guinness, Johnnie Walker, Baileys, J&B, Jose Cuervo, Captain
Morgan and Tanqueray, and Beaulieu Vineyard and Sterling Vineyards wines. Diageo
trades in some 180 countries around the world and is listed on both the New York
Stock Exchange (DEO) and the London Stock Exchange (DGE). For more information
about Diageo, its people, brands and performance, visit us at www.diageo.com


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