Allied Domecq produced a double whammy this week by announcing better than expected full year results ­ and revealing a strategic alliance with Captain Morgan firm Destileria Serralles. The deal has thrown the bidding for Seagram's drinks portfolio into turmoil, because Captain Morgan is one of the brands that most interests Diageo. But Destileria Serralles, which claims the rights to Captain Morgan, has announced an agreement to sell the brand to Allied. News of the deal came as Allied reported trading profit for its global spirits and wine division was up 13% to £414m in the year to August 31 on turnover up 9% to £2.27bn. In the UK, Allied has put its key brands back into growth, restructured, changed senior management and taken a new corporate view. Th changes have put the emphasis on fewer brands while investment in new product developments has been doubled. A move into the premium packaged spirit market, supported by heavyweight investment, is on the cards and a fresh approach to Beefeater gin in this country is being considered for 2001. The success of Allied's new approach is demonstrated by figures for its brands in the UK showing annual Tia Maria volumes up 19.2% (against a category up 17.3%), Harveys Bristol Cream up 4.5% (category -1.7%), and Courvoisier up 15.9% (category 9%). Allied's blended whisky, Teacher's, is one of the few underperformers. Annual volume is down 0.1% against a market growing at 1.4%. UK managing director Chris Heath said: "Three years ago senior management did not believe there was growth to be had. Things have changed, people now believe they can make the brands work and beat the targets for next year." {{NEWS }}

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