Allied Domecq receives rival approach

British drinks giant Allied Domecq, in talks with French peer Pernod Ricard over an agreed takeover, said today that it had received an 'indicative approach' from US groups Constellation Brands and Brown-Forman.

'Allied Domecq announces that it has now received an indicative proposal from the consortium regarding a potential counter offer,' a statement to the London Stock Exchange said.

'The indicative proposal is highly conditional, being subject to considerable further due diligence, confirmation of financing and a number of other significant conditions. It is too early to ascertain whether the indicative proposal will translate into a firm offer for Allied Domecq,' the statement said.

Allied - producer of Beefeater gin, Tia Maria and Courvoisier cognac, as well as Ballantine's and Teacher's whisky - would discuss the offer while continuing to move forward with the Pernod bid, the statement added.

'In the meantime, Allied Domecq will continue to progress the offer made by Pernod Ricard which was announced on April 21, 2005,' it concluded.

Pernod Ricard's bid of £7.4 billion sterling, recommended by Allied management last month, offered 670 pence per share. Pernod hopes to create the second-biggest spirits and wines company worldwide and the number one spirits company outside the US.

Following the agreed takeover, Pernod - maker of Glenlivet whisky and Havana Club rum - planned to sell £2.8 billion  of Allied assets to US group Fortune Brands, which produces Jim Beam bourbon.

Pernod forged a transatlantic alliance with Fortune Brands to fund its bid, which if successful would give it the muscle to challenge market leader Diageo. The Constellation consortium - also including private equity groups Lion Capital (formerly Hicks Muse Europe) and Blackstone - made a preliminary approach last month with a view to a counter-bid.

Brown-Forman owns brands including Southern Comfort and Jack Daniels and Constellation produces Stowells wine and Diamond White cider.