Allied Domecq welcomes rival bidders to challenge Pernod Ricard’s offer

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Thursday April 28, 10:21

Allied Domecq welcomes rival bidders to challenge Pernod Ricard’s offer

(by Natali Novak)

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Allied Domecq welcomes rival bidders to challenge Pernod Ricard’s offer

Allied Domecq is approached by rival bidders admitting the possibility of a bidding war with the first bidder Pernod Ricard.

Allied Domecq said on Wednesday that it had received a "preliminary approach" about a potential offer from a consortium of Constellation Brands and Brown-Forman as well as two private equity firms, the Blackstone Group and Lion Capital.

The Constellation-led group is said to make a formal offer for Allied Domecq soon.

As far as Constellation and Co. stated they are capable of a deal, Allied Domecq is now at the point to give them the same confidential financial information it has previously handed to Pernod Ricard.

Paris-based Pernod Ricard estimates that it could achieve $300 million a year in savings by buying Allied. French spirits company Pernod Ricard jointly with its partner U.S. firm Fortune Brands issued the $14.1 billion takeover offer for UK rival Allied Domecq.

But Allied Domecq chief executive Philip Bowman expressed some unwillingness to be acquired by Pernod Ricard that can be explained by the fact that the Pernod deal, after having been approved by shareholders, will cause the break up of Allied, with the assets to be carved between Pernod and Fortune Brands.

Constellation is not so free with funds. The company paid a $1.3 billion bid for Robert Mondavi Winery late in 2004 and is now "deeply indebted" because of it, said Robert van Brugge of Sanford C. Bernstein & Company in New York.

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Read the related news and articles:
26 Apr 2005 08:44 AM	Allied investors warn they may sell stakes
22 Apr 2005 11:16 AM	Pernod, Fortune make largest industry acquisition in 8 years
18 Apr 2005 04:49 AM	MERRILL LYNCH RAISED PERNOD RICARD TO "NEUTRAL" FROM "SELL"
06 Apr 2005 10:39 AM	Pernod and Allied in talks about takeover bid

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