Both of the world’s two largest wines and spirits companies Diageo and Allied Domecq gave indications of future strategy yesterday, in separate interviews with the UK newspaper the Sunday Telegraph.
CEO of Allied Domecq Philip Bowman once more indicated that his company would be interested in investigating the possibility of a merger with another of the larger spirits groups, in particular Bacardi-Martini.
The economics of merging Allied with another major player in the industry are clearly attractive,” Bowman said. “There would, for instance, be roughly £200m of cost savings from a deal with somebody like Bacardi and the capitalised value of that would be about £2.5bn, so that’s a fair amount for both sets of shareholders.”
Separately, the CEO of Diageo Paul Walsh discussed the possibility of extending the company’s relationship with the Dutch brewer Heineken.
In July the EU Commission approved the joint acquisition by Diageo and Heineken of Interbrew’s stake in Namibia Breweries Ltd.
And Walsh told the Sunday Telegraph: “I would love to work more closely with Heineken. I have huge respect for them. They have a fantastic brand. If you can have our spirits portfolio combined with a premium import beer such as Heineken – plus a premium dark beer such as Guinness and a premium local beer – then what a portfolio you can call on at the bar. Incredible.”
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