Vijay Mallya's bid to acquire Whyte & Mackay hits a major roadblock with Whyte & Mackay's chairman and chief executive Vivian Imerman asking for �200 million more than the price offered by the Indian liquor baron.

Mallya held talks with Imerman, who founded Whyte & Mackay with his brother-in-law Robert Tchenguiz, at the distiller's Grangemouth bottling plant last year.

Investment banking sources said Mallya put a price tag of �400 million against Immerman's demand of �600 million.

They added that Mallya also discussed the possibility of a distribution and licensing agreement with Glasgow-based Whyte & Mackay to tap into the foreign company's reserve. Mallaya also discussed the possibility of having franchise of some Whyte & Mackay brands in India which has witnessed rising popularity of aged malt whisky. Whyte & Mackay's business includes the Jura and Dalmore single malt whiskies, Vladivar vodka, Glayva liqueur and an own-label whisky operation.

Industry sources said although Scottish whisky accounted for only one per cent of the Indian market because of the high tariffs imposed by national and state governments, it had caught the fancy of the middle class population and had the potential to grow.

But Mallya may be down but not out of the race. The UB Group Chief Financial Officer Ravi Nedungadi said both the parties were still in discussions. He did not wish to comment on a possible distribution agreement on the plea that it was early to comment.

According to sources, Mallya's United Breweries [Get Quote], the third largest liquor company in the world after UK's Diageo and the French Pernod Ricardo, did not want to pay huge premium to Whyte & Mackay because of the fact that the foreign company was in the midst of a �100 million restructuring process.