Pernod seeks 'poison pill'

Pernod Ricard, the maker of Jameson's whiskey, has become the latest French company to ask shareholders to approve a "poison pill" mechanism introduced by the government earlier this year.

At the group's annual meeting on November 7th, investors will be asked to vote on a resolution authorising Pernod Ricard's board to issue warrants convertible into shares at a discounted price in the event of an unsolicited takeover approach. The tactic would drastically inflate the purchase price for any suitor making an offer for the company without first winning over Pernod Ricard's directors.

Pernod Ricard said the intelligent use of the poison pill provision would allow the board to obtain the best price for the company in the event of an unsolicited bid.

However, Matthew Jordan, an analyst at Dresdner Kleinwort, said: "I can't think of a less vulnerable company in the drinks industry."

Over the past five years, Pernod Ricard's share price has almost tripled in value, massively outperforming the CAC 40 index of leading French-listed companies.

Mr Jordan speculated that Pernod Ricard perhaps felt that a big brewer could at some point view the company as an acquisition target but added that this seemed to be an unlikely scenario.

Originally a manufacturer of pastis, the aniseed-flavoured aperitif, Pernod Ricard has successfully broadened its portfolio of products and its international presence under Patrick Ricard, chairman and chief executive since 1978.

Last year it bought Allied Domecq, the British maker of Ballantine's whisky and Beefeater gin. The deal made Pernod Ricard number two in the global spirits industry, ranking behind the UK group that owns Smirnoff vodka and Johnnie Walker whisky.

Following recent share purchases the Ricard family now owns 10.09 per cent of Pernod Ricard - up from 9.36 per cent in March - and controls 17.48 per cent of shareholder votes, according to a disclosure form released on Thursday. The family is the biggest party in a broader shareholder alliance that now controls 21.76 per cent of the shareholder votes.

Yesterday Pernod Ricard shares rose 0.55 per cent to €163.90.