Diageo, the world’s largest liquor company, has agreed to buy the Bushmills brand from Pernod Ricard S.A. along with the option to acquire a wine business for $362 million.
Diageo also agreed to not enter into discussions with any third party in connection with Pernod Ricard’s $14.2 million bid for Allied Domecq, the world’s No. 2 liquor company, according to a statement by Pernod Ricard. The deal could prove to be the deciding factor in the battle for Allied Domecq.
In the deal, Diageo gets the Old Bushmills Distillery Co. Ltd., including the Bushmills Irish whiskey brand and the option to buy the majority of Montana’s New Zealand wine business. The deals are expected to close by the end of 2005 or early 2006, the statement said.
“These undertakings will fall away if Pernod Ricard ceases to pursue its acquisition of Allied Domecq,” the statement said.
Last month, Allied Domecq agreed to a takeover offer from Pernod Ricard and partner Fortune Brands in Lincolnshire, IL. However, Constellation Brands — whose portfolio includes Hardys wine and Corona beer — was reported to be considering a possible counter-bid to the deal. Constellation and its partners, Brown-Forman and private equity investors Blackstone group and Lion Captial, have until June 29 to make an offer.
French beverage group Pernod Ricard’s product line includes Martell cognac and Jackob’s Creek wine.
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