Brown-Forman, one of the US's largest spirits companies, is rumoured to have its sights set on acquiring third-generation French cognac business Remy Cointreau.
The source of the rumour was Betaville, a City of London blog penned by freelance financial journalist Ben Harrington.
According to Harrington, his sources told him Brown-Forman is on the hunt for a big acquisition to avoid being left behind in the global drinks business following Japanese family company Suntory's recent purchase of bourbon business Beam Inc for $16 billion (€11.6 billion).
Brown-Forman, a fifth-generation family business, had revenues of $3.8 billion in 2013, compared to Remy Cointreau with sales of €1.2 billion.
Remy Cointreau, controlled by the Heriard Dubreuil family, may seem ripe for a takeover, as its profitability has been hit by slowing sales in China.
Eighty percent of its operating profit comes from cognac sales, 40% of which are generated in China – sales have fallen in this market following the Chinese government's crackdown on conspicuous consumption among its officials.
In November the company announced sales were down 6.3% to €558 million for the six months to September compared to the previous year, and it predicted a 20% drop in operating profit for fiscal 2014.
The Heriard Dubreuil family control just under 60% of Remy Cointreau, acquiring the original incarnation of the company, Remy Martin, in 1924 – at the time it was already a 200-year-old business.
Remy Martin merged with family-owned Cointreau in 1990.
Francois Heriard Dubreuil, 65, is acting chief executive – he stepped into the role after non-family chief executive Frederic Pflanz resigned earlier this year, and the company is still looking for a permanent replacement.
Ordinarily Heriard Dubreuil is chairman of the company, having taken over from his sister, Dominique Heriard Dubreuil, 67, in 2012.
A sale of the business is unlikely to take place in the near term, according to media reports, but there was a jump in the company's share price following the news.
No one from Remy Cointreau was available to comment.