TOP 10 BIGGEST DRINKS INDUSTRY ACQUISITIONS

Jun 16, 2015

(TDB) - Last week rumours were rife that AB InBev could be preparing a takeover bid for Diageo, a deal that would bring together the world’s biggest producers.

The rumour mill went into overdrive after a prominent columnist in Brazil claimed that the country’s richest man, billionaire Jorge Paulo Lemann, might be thinking about putting together a takeover bid for the world’s largest premium alcoholic drinks company.

While the claims have not been confirmed, and neither Diageo nor Lemann has commented on it, shares in Diageo jumped by 8% as the news broke to an 18-month high of £19.

As rumour of a Diageo takeover continue to swirl, we round up some of the drinks industry’s biggest mergers and acquisitions.

Chinese push further into Bordeaux

While it isn’t a single company buying another company, the continued push by Chinese investors on Bordeaux has been significant, with dozens of Bordeaux estates snapped up since 2010.

One hundred Bordeaux châteaux are now owned by Chinese investors as interest in the French winemaking region from China continues. The 100th château, Renon in the Cadillac Côtes de Bordeaux appellation, was bought by Chinese packaging millionaire James Zhou for an undisclosed sum in January. Just a few weeks before the Renon sale, Chinese property tycoon Chen Miaolin acquired the 24-hectare 18th century Château de Birot in Cadillac Côtes de Bordeaux.

Investors have also set their sights on Burgundy, with Chinese gambling tycoon Louis Ng Chi Sing paying €8m for Château de Gevrey-Chambertin in 2012.

China, remains Bordeaux’s key export market ahead of the UK and entrepreneurs in the country have been buying up châteaux in the region since 2010 both as status symbols and to quench a domestic thirst for the wines. There are around 7,400 winemaking châteaux in Bordeaux.

Bacardi enters Bourbon market with Angel’s Envy

Earlier this year Bacardi stepped into the buoyant Bourbon market for the first time, acquiring Angels Share Brands, including its Louisville Distilling Co subsidiary and Angel’s Envy brand.

The deal, which was completed for an undisclosed sum, will see Angel’s Envy continue as a standalone operation, with plans remaining in place for a new distillery and “brand experience center” to open in 2016.

Founded by the late Master Distiller Lincoln Henderson, whose son Wes Henderson remains with the company as global brand ambassador, Angel’s Envy is blended in small batches of 8-12 barrels, with the idea that each batch develops its own individual nuances.

This move by Bacardi follows predictions that sales of whisky in the US would move ahead of vodka last year for the first time since 2007, with Bourbon driving category growth.

Majestic buys Naked Wines for £70 million

In one the biggest acquisitions in the the UK wine trade in recent years, UK wine merchant Majestic bought crowdfunding wine retailer Naked Wines for £70 million in April, appointing its founder Rowan Gormley as Majestic’s new CEO.

Naked Wines was founded by Gormley in 2008 and allows “angels” to invest in winemakers in return for cheaper wine deals. Since its inception, Naked Wines has achieved impressive growth, with sales of £74 million to the end of 2014, up 40% on the previous year.

While both companies continue to operate as independent brands, the deal opens up opportunities for Majestic’s international growth in the USA and Australia, where Naked Wines has strong foothold. Its also presents a chance for both companies to share complementary strengths: Naked Wines’ online and e-commerce skills and Majestic’s national store network.

In its first annual statement, released yesterday, Majestic announced a drop in profits of 22.5%, which it attributed in part to the cost of acquiring Naked Wines.

Gruppo Campari diversifies into Italian bitters and grappa

In April last year Gruppo Campari bought the Italian bitter, liqueur and grappa producer Fratelli Averna for €103.75 million.

The deal saw Gruppo Campari take control of the 150-year-old company’s entire portfolio, which includes the Averna, Braulio, Limoncetta and Frattina premium brands, strengthening its leadership of the Italian spirits market and marking its first foray into the grappa category.

Fratelli Averna, based in Sicily, was founded more than 150 years ago by the Averna family, and has been continuously managed by the founding family for five generations. It has a 15% share in the Italian market, but also has a growing presence in central Europe and the US.

The previous month, Campari also acquired the Forty Creek Canadian whisky distillery for €120.5m.

SABMiller makes craft beer statement

SABMiller showed it meant business when it comes to craft beer earlier this year by purchasing Greenwich-based brewer Meantime Brewing Company.

Acquired for an undisclosed sum, Meantime is the first British brewery to enter SABMiller’s portfolio, with all 60 shareholders selling 100% of their shares in the company. Under the deal, Meantime will seek to expand its reach and sell its extensive range of craft beers, led by its London Pale Ale, London Lager, Yakima Red and Pilsner, in new global markets.

The world’s second largest brewer, London-based SABMiller owns 200 local and heritage beer brands including Fosters, Grolsch and Peroni. The company is keen to bring beer to a wider range of consumers, particularly women, and also aims to flag up beer’s food matching capabilities.

Meantime was founded in a tram shed in 1999 and now makes 40 different styles of beer. Meantime’s management team, led by chief executive Nick Miller and founder Alastair Hook, will continue to run the company.



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