DIAGEO chief executive Paul Walsh is to relinquish his role in July, the spirits giant has revealed, after a near 13-year tenure that has seen the closure of the Johnnie Walker plant in Kilmarnock and a 150% rise in the company's market worth.

Mr Walsh, one of the FTSE-100's longest-serving and highest paid executives, with an £11.2 million package last year, is to make way for chief operating officer Ivan Menezes.

But he will continue to receive his £1.2 million basic salary and maturing share awards for another 12 months before he leaves the company.

Mr Walsh has occupied the top post at Diageo, whose whisky brands include Bell's and Lagavulin, since 2000.

His replacement by Mr Menezes, who was born in India but holds British and US passports, has long been anticipated but the timing was hitherto unknown.

Diageo's shares barely moved, ending the day up 3p at 1977p.

Diageo chairman Franz Humer praised Mr Walsh's "ambitious and thoughtful stewardship" of the world's largest spirits business.

Since September 2000, Diageo's market worth has grown from £19.7 billion to £49.5bn.

Analysts at Investec calculate that, with dividends, £100 invested in Diageo has grown to £538 during this time, massively outperforming the wider FTSE-100 but lagging behind its arch-rival Pernod.

Much of the growth in Diageo's worth has come in recent years when Scotch whisky has been at the forefront of Diageo's drive into emerging markets.

Emerging markets now account for 43% of Diageo's sales, and the company is targeting 50% by February 2016. Its path has been eased by acquisitions in markets such as China and Turkey.

The expansion in sales led to the opening of the giant £40m Roseisle malt distillery in Speyside in 2010, with another £50m plant planned for Easter Ross.

But Mr Walsh has been ruthless in cutting costs, provoking protests from politicians and unions. He announced in 2009 that Diageo was closing its bottling plant in Kilmarnock, East Ayrshire, severing a 190-year association with the town at the cost of 707 jobs. The gates shut last year as the work transferred to Leven, Fife.

The closure of the Port Dundas grain distillery, where 200 people were employed, was announced at the same time. Mr Walsh will step down from the board at its annual shareholder meeting in September. He will retire on June 30, 2014.

Diageo said the prolonged handover was needed to ensure a smooth transition in its relationships with bodies such as the Scotch Whisky Association and the Government.

The whisky industry is engaged in a court fight against Scottish Government plans to introduce minimum pricing of alcohol. But the most pressing item in Mr Menezes's in-tray will be completing the acquisition of a stake in India's United Spirits, a deal with which he has been connected. This will include negotiating with competition officials over the future of United Spirts's Whyte and Mackay whisky arm.

Mr Menezes said: "Paul has made an extraordinary contribution and leaves a fantastic legacy."

Mr Walsh came from the Grand Metropolitan rather than the Guinness half of the Diageo merger. An accountant by training, he became chief executive of Pillsbury, Diageo's US packaged food business.

Pre-tax earnings amounted to £1.98bn in the 2001 financial year, Mr Walsh's first in charge, when its operations still included the Burger King fast food chain which he soon offloaded to a US consortium. Last year pre-tax earnings hit £3.1bn.

Martin Deboo, analyst at Investec, said: "We see this as a well-flagged change. For us, Menezes' immediate priority will be to deliver on Diageo's organic growth agenda, which has looked a bit less sprightly recently."