Fortune Brands makes its move for Allied Domecq
US spirits giant Fortune Brands has teamed up with Pernod Ricard in a takeover move for Allied Domecq.
UK-based Allied, owner of brands including Tia Maria, Courvoiser and Malibu, confirmed that it has opened discussions with French rival Pernod regarding a "potential" offer.
Allied, worth around £6.5bn, has been at the centre of bid speculation for some months, with the global spirits market seen as ripe for consolidation. If a deal materialises, the plan is for Pernod to table a formal bid, with Fortune providing some of the funding.
A solo move by either would be likely to attract the attention of the competition authorities in both the EU and US. However, by working together each would be able to cherry pick the brands best suited to their portfolios, and be better placed to compete with market leader Diageo.
Fortune is known to be keen to increase sales of its spirits brands, including Jim Beam and Knob Creek, in Europe, and has appointed investment bank CSFB to draw up a shopping list of potential acquisitions.
Along with the spirits brands, Pernod Ricard would hope to add Allied's wine brands to its own portfolio, whiuch includes Jacob's Creek, while Fortune's consumer brands business would be boosted by Allied's Dunkin' Donuts fast food operation.
