A £7.4bn takeover offer to create the second-largest wine and spirits firm in the world was last night accepted by Allied Domecq.

In a move that will spark a fresh reshuffle of famous brands including Courvoisier cognac and Teacher's scotch, Allied said it had agreed to be taken over by French rival Pernod Ricard.

A deal had been widely expected in the City after Allied confirmed earlier this month that it was in talks with Pernod, which has forged a transatlantic alliance with US-based Fortune Brands to fund its bid.

Analysts said the enlarged company would have the muscle to challenge market leader Diageo and welcomed the 36 per cent premium that Pernod was paying to secure boardroom support.

Taking over Allied made "compelling" financial and strategic sense to Pernod as it will strengthen its position overseas and generate savings of 300 million euros (£204.7m) a year.

Pernod is acquiring many of the biggest brands in the drinks industry including Beefeater gin, Malibu, Tia Maria, Kahlua, Stolichnaya vodka and Ballantine's scotch. It will also retain premium wines such as Mumm, Montana and Perrier Jouet.