Constellation pulls out of Allied bidding

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Pernod Ricard's bid for the UK liquor supplier is set to succeed as its main rival pulls out of the auction

Constellation Brands has dropped its bid for UK liquor supplier Allied Domecq, leaving the way clear for the joint bid tabled by Pernod Ricard and Fortune Brands. Constellation, whose partner in the bid was Brown-Forman, said the deal would not generate enough value.

"Simply put, careful consideration and evaluation of the details following due diligence did not identify sufficient value for submitting an offer," said Constellation chairman and CEO Richard Sands.

Pernod's £7.4bn ($13.5bn) offer, already accepted by Allied's shareholders, now looks set to succeed. Earlier this month the French supplier ensured market leader Diageo would not enter the bidding by offloading its Irish whiskey brand Bushmills and giving Diageo an option to purchase Allied's wine brand Montana, should Pernod's bid prove successful.

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