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Allied carve-up nears completion

Published:  23 July, 2008

Pernod Ricard is on the verge of aquiring its bigger rival Allied Domecq after both sets of shareholders backed the 7.6 billion deal and regulatory approval was given by both the US and EU competition authorities.

The aquisition still remains subject to approval from the Candian authorities, although this is not expected to pose a problem.At an Extraordinary General Meeting (EGM) held on Thursday 30 June, Pernod Ricard shareholders granted the board of directors conditional authorisation to increase the group's share capital by nearly e55 million through the issue of 17.7 million Pernod Ricard shares. And on Monday an EGM of Allied shreholders overwhelmingly supported the takeover, achieving an approval rate of 99.8%.

The acquisition will be effected by way of a Scheme of Arrangement, a procedure which guarantees the transfer of 100% of shares of the acquired company. Allied shareholders will receive 545p in cash and 0.0158 new Pernod Ricard shares for each Allied share. If the remaining regulatory hurdles are cleared, the Scheme will become effective by 26 July.

Allied chairman Sir Gerry Robinson said that approving the deal would provide shareholders with the ability to crystallise the value that has been achieved,

and the possibility of continuing to participate in the future success of Allied Domecq's

brands within an enlarged Pernod Ricard business'.

Chairman and CEO Patrick Ricard said: This major acquisition will make Pernod Ricard the world's second-largest wine and spirits group.'

US group Fortune Brands, which is providing 2.7 billion of the deals' capital, will pick up a number of brands as a result, including Teacher's Scotch and Maker's Mark bourbon.

Diageo, which agreed not to back any other takeover offer for Allied, will gain control of Montana wine and Bushmill's Irish whiskey.