Sazerac, the Louisville, Ky., spirits company, is preparing to submit an all-cash offer to buy the Jack Daniels maker Brown-Forman as it looks to sweeten its bid for the giant alcohol maker, three people familiar with the situation said Friday.
Sazerac has already offered to acquire Brown-Forman for about $15 billion in cash and stock. Its potential cash offer would also value the company at $15 billion, but cash offers are often preferred by sellers because they are easier to value, though Brown-Forman investors would have the option of stock if they preferred, the three people said.
The potential all-cash bid comes as Brown-Forman is already engaged in talks to be acquired by Pernod Ricard of France.
Any deal could reshape the alcohol industry at a time when its largest companies are grappling with tariffs, supply chain challenges and overall declines in alcohol consumption. Companies across many industries are also pursuing mega deals with the expectation they are more likely to be approved by President Trump’s antitrust regulators, who have proven to be more amenable to large tie-ups than those in the Biden administration.
Sazerac has also recently hired the investment bank Centerview Partners and the law firm Woolery & Co to advise on its efforts, the people said.
The company’s namesake brand, Sazerac de Forge et Fils, was the original spirit used in the Sazerac Cocktail.
The people who discussed Sazerac’s bid for Brown-Forman requested anonymity because the deal negotiations were confidential.
Sazerac’s offer of $32 a share is a roughly 39 percent premium on Brown-Foreman’s share price of about $23 a share, before deal talks were reported by Bloomberg in late March. Sazerac’s cash and stock offer for the company was reported earlier by The Wall Street Journal.
Shares of Brown-Foreman, which closed at $29 on Friday afternoon, are controlled by the family of its founder, George Garvin Brown.
Brown-Foreman had confirmed its deal discussions with Pernod Ricard in a news release, but declined to provide details in the release.
Pernod Ricard, which owns brands including Absolut vodka, Martell cognac and Jameson Irish whiskey, warned on Thursday that it expected its travel business, which includes its duty-free airport shops and cruises, to be in slight decline for the year, given the war in Iran. It now expects net sales for the whole company to fall by 3 to 4 percent for the year.
Shares of Pernod Ricard were up a little more than 1 percent Friday, giving it a market capitalization of $20 billion.
Lauren Hirsch is a Times reporter who covers deals and dealmakers in Wall Street and Washington.
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