Spirited Battle Shaping Up for Seagram Unit

Britain’s Allied Domecq may face a rival bid from Pernod-Ricard and U.S. private equity group Hicks, Muse, Tate & Furst for the spirits business of Seagram Co., bankers said. Allied Domecq is seeking a loan of more than $3.8 billion to support its widely expected bid for Seagram’s spirits arm, although it has yet to enter formal talks with the Canadian group, an industry source told Reuters. Seagram has said it will sell its spirits arm as a result of its recently announced $34-billion all-share merger with France’s Vivendi. Pernod-Ricard and Hicks Muse have also approached banks to provide financing for a bid of their own, the bankers said. Seagram’s spirits brands--which are estimated to be worth about $7 billion--include Chivas Regal scotch and Absolut vodka, and Allied Domecq has been working on plans to add these to its Ballantine’s scotch and Beefeater gin brands. A London-based spokeswoman for Hicks Muse, which last year bought Seagram’s Mumm and Perrier-Jouet champagne brands for about $310 million, refused to comment on a possible offer for the business. An Allied Domecq spokesman also declined to comment on whether it would bid or was raising a loan.