Lion Nathan, the Australian brewer and winemaker, said today that Allied Domecq had accepted an offer to sell Lion Nathan its 15% share in the Australian winemaker Banksia, for A$1.27 a share.

The deal takes Lion's relevant interest in Banksia to 99.1% of the shares in Banksia and means that Lion can proceed immediately with the compulsory acquisition of the outstanding shares.

"All remaining Banksia shareholders are encouraged to accept the offer as soon as possible. Lion's offer will not be extended and the offer will close at 7.00 pm, Sydney time, on 24 January 2003, " Lion Nathan said in a statement.

Commenting on the announcement, Gordon Cairns, chief executive officer of Lion, said: "We are pleased that Allied recognised the attractiveness of Lion's offer. The offer provides an opportunity for the remaining Banksia shareholders to exit at an attractive price. The acquisition of 100% of Banksia will enable Lion to integrate fully Banksia's operations with our other wine businesses. We encourage all remaining Banksia shareholders to accept the offer as soon as possible".

The deal between Allied and Lion follows around half a year of talks between the companies.

Lion Nathan announced it was making an offer for the ourtstanding share in December last year. Allied acquired its 155 stake in the winemaker in October 2001.