Diageo, Allied Domecq and Pernod Ricard are not expected to enter the race for Southcorp, according to reports. Citing sources close to the deal, Reuters said yesterday (17 January) that Diageo and AD have ruled out a bid for the Australian wine company, but may look at businesses sold off in a Foster's link-up.

Following yesterday's hostile bid by Foster's for Southcorp, Diageo and AD were considered as potential suitors as well as neither has a wine business in Australia yet. The sources told Reuters, however, that both are not now expected to make a counter bid.

"Diageo have looked at Southcorp before, and will prefer to look at smaller wine groups," one source told the news agency.

"Allied's primary interest will be what brands become available when the deal is done," the source added.

It is also unlikely that Pernod Ricard would lodge a counter bid as it already has Australian wine interests through its Jacob's Creek and Wyndham Estate brands, the sources added.

All three companies declined to comment to Reuters.