Jack Daniel’s maker Brown-Forman has rejected a roughly $15 billion takeover offer from rival Sazerac ending another potential consolidation deal in the struggling global spirits sector.

The Wall Street Journal reported that Sazerac offered $32 per share in cash for Brown-Forman, valuing the company at about $15 billion, weeks after merger talks between Brown-Forman and French drinks group Pernod Ricard collapsed. Brown-Forman shares closed down 1 per cent at $26.56 on Tuesday, well below the rejected offer price.

The paper reported that advisers for Brown-Forman informed Sazerac on Monday that the proposal had been rejected. Brown-Forman, which is controlled by members of the founding Brown family through a majority of voting stock, and privately held Sazerac both declined to comment.

Reuters separately reported that Sazerac’s offer was backed financially by Wells Fargo and Apollo Global Management. The proposal would have allowed Brown-Forman’s Class A shareholders either to take cash or roll their holdings into the combined company, according to a source familiar with the matter.

The news wire previously reported that the Brown family had favoured a transaction with Pernod Ricard because it would have allowed them to retain a meaningful stake and influence in the merged business. Pernod’s proposed structure was largely stock-based, while Sazerac’s approach relied more heavily on cash financing and would have required the family to relinquish control.

The failed approach comes as the global spirits industry faces weaker demand and falling alcohol consumption, which have reduced sales volumes and pressured company valuations. Bankers and analysts told Reuters that larger drinks groups are increasingly pursuing scale to strengthen distribution networks and improve negotiating power with retailers and distributors.

Brown-Forman owns brands including Jack Daniel's, Woodford Reserve and Herradura tequila, while Sazerac controls more than 500 brands including Buffalo Trace bourbon and Fireball Cinnamon Whisky. Reuters reported that a merger between the two Kentucky-based groups would have created a company controlling about 30 per cent of the US whiskey market.

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