Constellation Brands Inc. and a few other beverage companies may be pondering a counterbid for top winemaker Allied Domecq plc, but analysts warned they may have missed last call

Food & Drink Weekly, May 2, 2005

Constellation Brands Inc. and a few other beverage companies may be pondering a counterbid for top winemaker Allied Domecq plc, but analysts warned they may have missed last call. Constellation, owner of the Simi, Arbor Mist and Hardys wine brands as well as Corona beer, has hired British investment bank NM Rothschild & Sons to investigate a bid, according to press reports over the weekend.

It would have to top an agreed $14.4 billion offer from rival Pernod Ricard SA. Press reports also said privately held Bacardi Ltd., a private equity firm, Japan's Suntory Ltd. or French luxury goods group LVMH Moet Hennessy Louis Vuitton SA could be seen as counterbidders. The speculation has focused, however, on Constellation, possibly with a partner, such as Bacardi, though analysts warned a counterbid would be tricky because Pernod's agreement with Bristol, England-based Allied is sealed and fully priced. Bacardi, meanwhile, may be considering its own deal, according to press reports. It has been exploring an initial public offering that would allow it to participate in industry consolidation. Allied has tried to merge with Bacardi in the past, but the complicated nature of Bermuda-based Bacardi's family shareholding has thwarted any prospects of a deal.