Whitbread and Domecq deal thrown into question

- The proposed £2.35 billion acquisition of Allied Domecq by brewing giants Whitbread has been thrown into question after talks aimed at tying up the transaction fell apart this weekend.

- The proposed £2.35 billion acquisition of Allied Domecq by brewing giants Whitbread has been thrown into question after talks aimed at tying up the transaction fell apart this weekend.

An announcement of the deal had been expected today. But according to newspaper reports, final meetings between the two broke up acrimoniously on Saturday following a row over how much debt Whitbread would take on. A further factor was a dispute over taxation issues that effectively meant Whitbread wanted to reduce its offer by about £75 million.

If the deal does still go through, Whitbread would have to sell its brewing interests, a move that could affect its agency arrangements. Whitbread currently uses Lowe Howard Spink and Bartle Bogle Hegarty and the media agency, Motive.

Up until now the Whitbread-Allied talks have been exclusive, but this latest development could open the way for formal approaches from other breweries such as Bass or Punch Taverns.



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