Allied Domecq shelves C & C share listing

Plans for the stock market flotation of Cantrell & Cochrane have been postponed by drinks combine Allied Domecq following the collapse of share prices since its acquisition of Diageo's 49.6 per cent minority stake for around £250 million in July. But Allied Domecq chief executive Mr Tony Hales said yesterday that the Investment Bank of Ireland, together with the group's financial advisers Goldman Sachs and Warburg Dillon Read, had been asked to review the scope for a float when share markets recover.

The review is part of a wider study of the best way for Allied Domecq to "maximise shareholder value" from its 100 per cent ownership of Cantrell & Cochrane. Options include retention of the Irish business and trade sale to a drinks distributor seeking entry into the Irish market as well as a stock market flotation.

Mr Hales, commenting on Allied Domecq's full year results, said the purchase of the 49.6 per cent minority interest in Cantrell & Cochrane in July had been "at a very attractive price". Although the price has still not been disclosed, financial details of Allied Domecq end-year balance movements indicate that the price tag was just over £250 million. The group's net borrowings increased from £1.14 billion to £1.4 billion in the year to August 31st. Financial results of Cantrell & Cochrane are not disclosed by Allied Domecq.

However, Mr Hales was enthusiastic about the group's purchase of the outstanding minority interest, saying that the deal would be "earnings enhancing". Annual results of Allied Domecq detailed a one per cent increase in profit before tax to £615 million despite a £46 million hit from strong sterling.

Turnover at £4.31 billion was broadly flat at constant exchange rates.

Total dividend payments are 3.6 per cent higher at 25.33 pence per share. The financial results were better than expected, leading to a strong 49p rise in the Allied Domecq share price to 520p and prompting a mark-up in shares of other drinks shares.