Allied wooed by Constellation, Diageo

New York-based Constellation - the world’s largest wine group - said it was working on a joint offer in conjunction with US wine company Brown-Forman, and two investment groups, Lion Capital and Blackstone.

Although the news has boosted Allied’s share price, the deal looks set to scupper Pernod Ricard’s original offer of £7.4b (US$14b). Constellation’s bid is reportedly around the same mark, but it is thought to be making a cash-only offer. That is much more attractive, some analysts say, than Ricard’s offer, which is 80% cash and 20% equity.

A Pernod Ricard spokesman downplayed the threat to his company’s bid. ‘We are confident that our offer is the good offer,’ he said.

UK broadsheet the Times added to the speculation yesterday with reports that Diageo, the world’s largest drinks group, was in talks with Bacardi with a view to making its own offer for Allied.