Ups and Downs: Diageo's Adventure in China's Traditional Liquor Market

Research output: Other contributionCase Studies


This case describes Diageo's acquisition of shares in Shuijingfang Co. Ltd, a traditional Chinese Baijiu maker, from 2006 to 2019. The setting is the spirits sector in China, which accounted for nearly a quarter of global consumption during this period. Diageo has amassed significant experience in M&A activities on different continents since its formation in 1997, most of which were highly successful, propelling it to become the global leader in the alcoholic beverage industry. However, Diageo's adventure with Shuijingfang in the Baijiu sector experienced plenty of ups and downs. The challenge lay in how Diageo could achieve its strategic goal of entering the largest, most profitable, and fastest-growing Baijiu segment in China by acquiring a domestic Chinese Baijiu maker. Diageo had to make several difficult decisions, weighing the inherent value that Shuijingfang could bring to the group and determining the best way to leverage Diageo’s global expertise in the high-end spirits market within the Chinese Baijiu sector, while also adapting to the local context.
Original languageEnglish
Number of pages11
Publication statusPublished - 30 Apr 2024

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Case type

Field Case

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Published by

China Europe International Business School


  • mergers and acquisitions
  • M&A
  • Mergers & Acquisitions
  • foreign companies in China
  • Merger and Acquisition (M&A)
  • merger and acquisition

Case studies discipline

  • General Management
  • Strategy

Case studies industry

  • Accommodation & Food Services


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