Allied off the floor

Article Abstract:

Allied Domecq is likely to reach an agreement with a rival after the merger between Grand Metropolitan and Guinness. Allied Domecq has reduced its costs for 1996 to 1997, though currency movements offset the gains from this. An underlying improvement is clear, and the company has maintained or increased sales for its global brands. The pubs business has also shown progress. Allied overpaid for Domecq, and stockholders are not likely to approve a deal until it is shown to be beneficial.

Beverages, Beverage Manufacturing, Beverage industry

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Alcoholic beverages: have another

Article Abstract:

Guinness, Allied Domecq and Grand Metropolitan account for 29 brands of the main 100 world spirit drink brands, and the aggregate market capitalization of these companies is 23 billion pounds sterling. Mature markets account for 90% of sales, and this has led to static profits. Emerging markets can show rapid growth but also involve investment in marketing. Guinness has developed the strongest position in these markets, while food accounts for almost 60% of the profit of GrandMet.

Grand Metropolitan PLC, Arthur Guinness Son PLC

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Tequila sunset at Allied

Article Abstract:

Allied acquired Domecq in 1994, and Allied Domecq has since been affected by problems in the Mexican market. The company has sold its food activities and saved on interest payments, though has also had to sacrifice operating profits. The group also includes UK bars and two US franchise chains for ice cream and donuts. Allied Domecq is reorganizing its spirits activities. Analysts foresee a recovery in profits for 1996 though further charges for restructuring are possible.

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