Japan's second-largest beer maker, Kirin Brewery Co Ltd, said today that, in order to strengthen its ties with French drinks group Pernod Ricard, it had acquired a 32.4% stake in SIFA, which holds 10.2% of Pernod Ricard's capital.

Kirin would not reveal the financial cost of the acquisition in SIFA, or Societe Immobiliere et Financiere Pour L'Alimentation, which would indirectly represent a 3.3% stake in Pernod Ricard, but the Jiji news agency said it paid more than 20 billion yen (US$155m).

The deal follows Kirin's move in March to assume responsibility for distribution in Japan of the Pernod Ricard brands Chivas Regal, Royal Salute and Glen Grant. Kirin Brewery already distributes Martell Cognac there on behalf of the group.

It is the latest move by Kirin to diversify from the slowing domestic beer market into higher-margined businesses. The ailing Japanese beer market has been contracting rapidly for the past five years and has forced its largest drinks companies to look for new cash-generating opportunities.

The Japanese domestic beer market is down 20% from 1996 and saw a 4.5% drop last year as economic slow down and changing tastes hit regular beer consumption.

In response, last year, Kirin acquired the Bourbon brand Four Roses from Pernod Ricard and Diageo Plc, a 15% stake in Philippine brewer San Miguel Corp and the food business of Takeda Chemical Industries Ltd.

Rival Asahi Breweries Ltd, has also branched out beyond its beer business, and recently acquired the low-alcohol and "shochu" - or distilled liquor - businesses of chemical firm Asahi Kasei Corp and the alcohol business of fermented chemicals maker Kyowa Hakko Kogyo Co in February.