Beverage M&A Roundup, July 2022 – What Just Drinks Thinks

Diageo sells its Cameroonian subsidiary Guinness to Castel

Diageo sold its Guinness brewing business in Cameroon to its French counterpart Groupe Castel. The deal, completed for £389m ($460.3m), will see Castel take over local production and distribution of Guinness, while Diageo will remain responsible for the A&P of its flagship beer brand on the market. market.

Just Drinks thinks: Diageo’s flagship beer continues to see strong momentum in Africa – in its latest financial results, beer sales rose by more than a fifth in the region – but the London-based group is continuing what CEO Ivan Menezes describes as a “light asset”. » strategy for its brewing activities on the continent. Earlier this year, the group reached an agreement to sell its brewery in Sebeta, Ethiopia, also to the Castel group.

Cameroon deal described as ‘license and royalty agreement’ logic, allowing Diageo to take advantage of Castel’s five brewing sites, as well as their national distribution network, to increase volume sales, while continuing to retain control of the A&P investments behind the brand.

Read more on this topic: The middle classes are driving the growth of super premium spirits – CEO of Diageo

Campari expands with the purchase of Del Professore

Campari expanded its spirits portfolio again through mergers and acquisitions, acquiring its Italian counterpart Del Professore. Rome-based Del Professore, set up by bartenders in 2013, will join Milan-headquartered Campari as the group ‘aims to consolidate its position in the super premium craft vermouth and gin categories’ .

Just Drinks thinks: For the second time in just over two months, Campari has used M&A to complete its portfolio. Del Professore – a contemporary vermouth and gin maker set up by a group of Italian bartenders – is more on the modern, artisanal end of the spectrum than Campari’s other recent purchase – the dusty and badly needed .TLC Picon bitter liqueur brand.

The purchase strengthens Campari in the vermouth and super premium gin segments, giving it a plug-and-play option that won’t require any kind of significant facelift to boot. Spirits commentator Richard Woodard agrees, going so far as to compare the investment to Pernod’s acquisition of Monkey 47 Gin.

More on this topic: Bitter prospects lurk behind Campari’s Picon purchase

E&J Gallo Winery enters American whiskey with investment in Horse Soldier Bourbon

E&J Gallo Winery has added another brand to its Spirit of Gallo division, making a “strategic investment” in American small-batch whiskey maker Horse Soldier Bourbon. The deal – the terms of which have not been disclosed by either party – will see Spirit of Gallo begin distributing the brand in the United States, effective immediately.

Just Drinks thinks: Another day, another dollar invested in American whiskey. American bourbon certainly seems to be the spirit of the day when it comes to investment and M&A activity right now. Earlier in the month, we saw Bardstown Bourbon Co. – which was itself acquired by a private equity firm in March – assuming full ownership of fellow bourbon producer Green River Spirits, while last week , Beam Suntory has announced plans to invest $400 million in its Booker Noe Distillery.

With the US whiskey market steadily growing around the world – the category is expected to be worth $25 billion by 2026 – and Anglo-European-American tariffs finally being phased out, E&J Gallo will seek opportunities for Horse Solider not only in its already well-established internal market, but also further afield.

Purchase is E&J Gallo’s first since forming a dedicated spirits division Spirit of Gallo – in March, and it wouldn’t be surprising to see the California-based group become a bigger player in spirits in the future, as the category continues to take market share from wine and beer in the United States.

More on this topic: American whiskey at the start of the trail does not end, as the tariff barrier falls – commentary

Royal Unibrew acquires Canadian company Amsterdam Brewery Co.

Royal Unibrew bought Canadian craft brewer Amsterdam Brewery Co. for C$44 million (US$33.9 million) in a bid to bolster its production and distribution in North America. The craft brewer operates two restaurant-bars in Canada, Brewhouse on the Lake in Toronto and Barrel House in Leaside. Both are included in the deal.

Just Drinks thinks: The purchase of Toronto-based Amsterdam Brewery Co. will help protect Royal Unibrew’s business from rising transportation costs and other supply chain issues that have plagued the global beverage industry over the past of the last twelve months. In a move that echoes the move from Sapporo for Stone Brewing last month, Royal Unibrew said it intended to serve much of its North American market from the production facility at 65,000 square feet of Amsterdam Brewing Co.

Craft beer in North America has had a tough time lately – highly publicized sales such as Stone and that of struggling Modern Times have led some to suggest that the market has reached a saturation point. While it is It’s fair to say that the explosive growth opportunities – and huge investments – that have defined the segment over the past ten to 15 years are likely a thing of the past, this recent flurry of M&A activity suggests that craft beer and specialty is always an attractive proposition.

More on this topic: Why Sapporo’s move for Stone Brewing makes sense

Other notable M&A deals in the global beverage industry this month:

AXA Millésimes returns to the United States with the move of Platt Vineyard

Treasury Wine Estates takes over Accolade Vineyard in the Yarra Valley

Beam Suntory and Edrington sell Maxxium Russia

EARI Beverage Group adds Original New York Seltzer to its craft portfolio

Coca-Cola sells assets in Vietnam and Cambodia to Swire Pacific

Twist as Modern Times Beer Co. sold to Maui Brewing Co.

Halewood sells its South African branch to private equity

Kirin Holdings to sell Myanmar JV shares to partner

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