Drinks company Diageo has agreed to buy Bushmills Irish whiskey from Pernod in a deal worth €297 million.
Bushmills is the number two Irish whiskey, behind market leader Jameson, which is owned by Pernod.
In a separate deal, Diageo has agreed to buy most of Allied Domecq’s Montana wines if Pernod’s bid to buy Allied is successful. The company also said it had agreed with Pernod to cease talks with any third party in connection with the purchase of any of Allied's brands, tying it to Pernod.
Analysts had previously thought Diageo would be interested in more of Allied's brands such as Maker's Mark bourbon, Courvoisier cognac and Mumm champagne.
However, Diageo said Montana and Bushmills were two growth brands, while the acquisition of Courvoisier and Mumm could have damaged its relationship with LVMH.
Diageo has 34 per cent of drinks unit Moet Hennessy owning the world's top selling champagne and cognac, with LVMH owning the remaining 66 per cent.
Pernod and Allied expect their deal will be completed on July 26th, and close in late 2005 or early 2006 after regulatory clearance.