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Will Spirits Merger Mix It Up For Shops?

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Spirits marketer Pernod Ricard's proposed $14 billion acquisition of Allied Domecq puts a total of $200 million in U.S. ad assignments—handled by at least a dozen shops—into question.

Pernod Ricard has said it expects to achieve a $300 million reduction in annual operating costs from the acquisition by combining distribution and marketing functions, according to a consultant following the deal. Among the popular brands Pernod will acquire are Beefeaters, Malibu, Ballentine's, Kahlua, Tia Maria, Mumm and Perrier Jouet.

U.K.'s Allied spent $100 million in the U.S. last year, including its spirits brands and Dunkin' Donuts, Togo's and Baskin Robbins units. France's Pernod Ricard spent $30 million and Fortune Brands, a U.S. company that also owns Titleist and which is acquiring several of Allied's brands in the deal including Courvoisier, Maker's Mark and Canadian Club, spent $70 million on U.S. advertising last year, per Nielsen Monitor-Plus.

Among the creative agencies involved are Publicis Groupe's Publicis in New York and Interpublic's Hill, Holliday, Connors, Cosmopulos, Boston (both Allied shops), Omnicom's BBDO and Havas' Arnold (Fortune) and WPP Group's Berlin Cameron/Red Cell in New York (Pernod). Media agencies included Publicis' Zenith Media (Allied), WPP Group's Mediaedge:cia (Fortune) and Aegis Group's Carat (Pernod).