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Diageo linked with LVMH bid

Published:  22 April, 2009

Diageo is in the early stages of preparing a bid to take over the wine and spirits interests of French luxury goods firm LVMH, according to UK press reports.

The acquisition would plug major gaps in the Diageo portfolio, with the arrival of Moet & Chandon, Krug and Dom Perignon Champagnes and Hennessy Cognac.

Speculation suggests that LVMH would seek around Euros12 billion in cash which would be used to fund acquisitions in the fashion industry.

Revenue from the LVMH wines and spirits division was Euros 3.1 billion, a drop of 3% on the previous year, while its fashion, leather goods, perfumes and cosmetics businesses all saw rises.