Pernod expects to clear last Seagram hurdle

Pernod Ricard, the French drinks group, expects to clear the last regulatory hurdle to its joint $8.15bn (£5.7bn) bid for Seagram next month, with approval from antitrust authorities in the US and Canada.

Pernod had hoped to finalise the joint acquisition with Diageo, the UK drinks group, in July, following European Commission consent in June. Richard Burrows, Pernod's joint managing director, said: "It's a very complex transaction, the timetable is in the hands of the regulators. But we believe we will get approval in September."

The deal, announced in December, will transform Pernod from a diversified company into a pure wines and spirits group by the end of the year. The Ricard to Jameson's Irish whiskey group is also close to concluding the £419m sale of its Orangina soft drinks business to Cadbury Schweppes.

Pernod reported a first-half jump in sales of 7.2 per cent to 2.2bn euros (£1.35bn), beating expectations and putting the group on track to reach its 10 per cent earnings growth target in the first half when it reports its interim results in September.

Strong demand for Pernod's Jacob's Creek wines, particularly in the UK and the US, helped the group's spirits and wine sales surge 12 per cent. Mr Burrows said: "The strong results within wines and spirits vindicates our business model and shows we are getting our sales and marketing strategy correct."

Volumes in its 10 key brands grew 12.4 per cent compared with 9.6 per cent a year earlier. Patrick Ricard, the chief executive, said: "Our task now is to maintain that momentum following the acquisition of the Seagram brands."

Analysts will closely monitor how well Pernod and Diageo manage to integrate the Seagram portfolio given the two groups' different management styles. To help Pernod cover debt for the $3.15bn it paid for its 39 per cent of Seagram, the group is selling its BWG wholesalers in the UK and Ireland.