The US spirits and wines group, Brown-Forman Corp., has announced that it is planning to buy back up to 8.3m shares of its common stock in a "Dutch auction" tender offer. The price of the company's Class A and Class B rose sharply after the announcement.

On the New York Stock Exchange, Brown-Forman's Class A shares were up $6.30, or 9.71%, at $71.20, while its Class B shares rose by $7.86, or 12.65%, to $70.00.

The Kentucky-based company said it would repurchase as many as 1.5m Class A shares and 6.8m Class B shares, with an offer price for both classes of stock wihin a range of US$63 to US$73 a share. Brown-Forman said its board of directors believed that the buyback was a "prudent use of the company's financial resources".