Drinks firm Diageo is to set up a joint venture with Dutch vodka maker Ketel One, ditching a possible deal with Swedish vodka group Absolut.

Diageo will pay $900m for a 50% stake in the joint venture, which will sell, market and distribute the family-owned Dutch brand.
Diageo says Ketel is a ‘better strategic fit’. The company sells 1.9 million cases of vodka a year, about 95% of which go to the North American market.