Pernod Ricard, the French drinks group and parent of Irish Distillers, is raising funds in London for a £5 billion sterling bid for British conglomerate Allied Domecq's spirits arm, a report said yesterday. A spokesman for Irish Distillers said he could make no comment. Allied Domecq has no Irish whiskey brands and an amalgamation of the companies would give Irish Distillers' brands greater access to markets, according to industry sources.

The Sunday Telegraph said that the family-run group, which makes the famous Pernod aniseed drink, had hired Banque Nationale de Paris to syndicate a multi-billion pound loan to launch an offer. A successful bid would create one of the world's largest spirits companies, combining Allied's portfolio, which includes Beefeater gin, Ballantine's whisky and Courvoisier cognac, with Pernod's Jameson and Bushmill Irish whiskeys and Dubonnet vermouth.