UK wine and spirits giant Allied Domecq has announced that it has acquired the French Champagne houses G.H Mumm & Cie and Champagne Perrier-Jouet for EUR575m, two brands currently in the portfolio of brands distributed by Seagram. The announcement comes within hours of Allied revealing it was pulling from the race for Seagram's spirits, and along with its claims to have secured the Captain Morgan brand is the second coup for Allied from within the Seagram business while the Canadian's auction is going on.

"Through the champagne, rum and vodka transaction, we have substantially achieved the strategic and commercial objectives that might have been obtained through the sale of the whole of the Seagram wines and spirits business," Chief Executive Philip Bowman said in a statement.

Bowman added that the group had achieved its aims without the risk involved in integrating a large and disparate brand portfolio.

The acquisition from Hicks, Muse, Tate & Furst and a small number of minority shareholders will be on a debt free basis, payable in cash from existing facilities.

Allied said the acquisition is expected to be earnings enhancing in the first full year (before the amortization of goodwill). The company estimates that the full year pro-forma EBITDA contribution including an assumed distribution margin will be some EUR55m.

Bowman said: "The acquisition of Perrier-Jouet and Mumm adds two world class premium Champagne brands to our portfolio and supports our objective of continuing to build a global wine business. The transaction is earnings enhancing in the first full year of ownership and will not diminish Allied Domecq's commitment to participate in the process of industry consolidation."

John Muse, a founding partner of Hicks, Muse, Tate & Furst said: "When we acquired Mumm and Perrier-Jouet last year, we saw an opportunity to invest behind two strong brands that would benefit from a more focused and targeted marketing strategy. We have been successful in implementing that strategy in partnership with the management team and believe that these brands are now two of the strongest in Champagne."

He continued: "Vivendi's purchase of Seagram presented the opportunity to secure the best long-term future for the brands through this sale to Allied Domecq."