Diageo linked to bid for Jim Beam

Diageo has been linked with a bid for Jim Beam, the number two American whiskey brand after Jack Daniel's.

There is speculation that Jim Beam owner Fortune Brands is preparing for a break-up and that spirits rivals are running the rule over its leading brands. As well as Jim Beam, these include Courvoisier, Sauza, Cruzan rum and Laphroaig.

Diageo would be unlikely to make a bid for the entire Fortune spirits portfolio without running into regulatory problems. This raises the prospect of bidding in tandem with another company, or being forced to sell some of the brands it picked up in any deal with Fortune.

One source from the US financial sector said: "If Fortune's spirits become available, Diageo has to be the leading candidate. Fortune has one of the two big American whiskies in Jim Beam and one of the fastest growing in Maker's Mark."

Sales and distribution for Jim Beam in the UK comes under the remit of Maxxium, a company jointly owned by Fortune (through its Beam Global business) and Famous Grouse owner Edrington.