Constellation set to gatecrash Allied party

SHARES in Allied Domecq bubbled up to an all-time high today as US group Constellation Brands said it could try to break up the planned union between the British drinks giant and France's Pernod Ricard.

Pernod tabled a £7.4bn, 670p-a-share bid for Allied last week after teaming up with Jim Beam whisky group Fortune Brands to divide the spoils, sending Allied shares up 25%.

However, after Constellation today confirmed it is at 'an early stage of evaluating its options' towards Allied, the shares leapt beyond the French offer price to 672p, up 9p.

Constellation which owns Corona beer and Australia's Hardys and Banrock Station wines, is being advised by NM Rothschild and Merrill Lynch. As in the Pernod offer, Constellation is looking for a bid partner and says it is talking to a number of parties.

While it has its eyes on Allied's wine portfolio - the Mumm and Perrier Jouet champagne brands, Cockburn's port and strong interests in Spanish, Californian and New Zealand wine regions - it would probably want to hive-off Allied's portfolio of spirits including Beefeater gin, Stolichnaya vodka and Malibu cocktail.

Other potential bidders that might side with Constellation include Bacardi, the family-owned maker of the eponymous white rum, and Brown-Forman, the US group behind Jack Daniel's.