Diageo PLC, the maker of iconic liquor brands like Guinness and Baileys, may be a potential takeover target for Brazilian billionaire Jorge Paulo Lemann and his private equity firm 3G Capital. Lemann, the country's richest man, along with his partners Marcel Telles and Beto Sicupira, is in the early stages of formulating a buyout offer for Diageo, Brazilian weekly Veja reported on Sunday, according to Reuters.

Diageo’s stock rose from a two-month low after news of the possible acquisition hit markets, going up by 8.7 percent on Monday, its greatest intraday gain since 2008.

Britain's Diageo, the world's largest producer of spirits, also owns other well-known brands including Johnnie Walker Blue Label, White Horse, Windsor and Captain Morgan.

Lemann also owns a stake in the world’s largest brewer Anheuser-Busch InBev. The Harvard-educated investor has made inroads with other food and beverage companies in recent years, buying Burger King Worldwide Inc. from Diageo in 2010 and H.J. Heinz Co. in 2013 in partnership with famed investor Warren Buffett. His firm is now working to merge H.J. Heinz with food giant Kraft Foods Group Inc.

In April, Diageo reported that its sales in the three months preceding March had fallen by 0.7 percent amid a weakened global economy and slow recovery.

"Diageo bid speculation from 3G Capital looks like it may have legs," Sanlam Securities execution trading head Mark Ward told Reuters. "Diageo (is) a solid company, and with the shares below £20 $30), they are certainly attractive to a potential suitor."