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UK/IRELAND. William Grant & Sons is to acquire the spirits and liqueur division of C&C Group for €300 million. The deal is subject to C&C shareholder approval. The proceeds will go towards reducing C&C’s debt.
The C&C portfolio includes a range of premium niche brands such as Tullamore Dew, Carolans, Frangelico and Irish Mist, which are exported to over 80 markets, the group said. C&C also owns Irish cider brand Bulmer’s, export brand Magner’s Cider and beer brand Tennent’s, which are not being sold.
For the year ended 28 February 2009, the C&C spirits and liqueurs division generated revenue of €85.9 million, EBITDA before exceptional items of €16.1 million and EBIT before exceptional items of €15.3 million. For the year ended 28 February 2010, the Division is expected to report EBITDA of around €15.3 million and EBIT of €14.7 million.
Following the disposal, C&C will retain certain overhead costs which are currently allocated to the division. This overhead was €1.5 million in the 2009/10 financial year. The gross assets of the division, at 28 February 2010, amounted to approximately €109.7 million.
The division’s management team and employees (57 people in total) will transfer with the business on disposal. William Grant will operate the division’s packaging facility located at the group’s manufacturing site in Clonmel, Co. Tipperary.
C&C Group Chairman Tony O’Brien said: “We are pleased to announce our agreement to sell our Spirits & Liqueurs Division to realise significant value for the group. The division comprises a portfolio of unique brands carefully developed over many years. The agreement to sell to William Grant was not an easy one but is, we believe, in the best interests of all shareholders.”
C&C Group Chief Operating Officer Stephen Glancey added: “While the division represents a comparatively small component of C&C’s overall earnings, the consideration reflects the quality of its brand portfolio and its strong market positions. The group intends to reduce debt and invest to support the continued development of a cider-led long alcohol drinks portfolio.
“While the Spirits & Liqueurs Division has been a successful component of the group for several decades, we believe that William Grant is best placed to grow and develop this business for the long term. William Grant provides strong heritage and a complementary portfolio of world renowned brands which includes Glenfiddich Single Malt Scotch Whisky and Hendrick’s Gin.”
William Grant CEO Stella David said: “William Grant has a rich history in Scotch whisky dating back to 1886, and we have been looking to further develop our non Scotch portfolio. Irish whiskey is a natural fit and the C&C spirits business provides a unique opportunity to acquire a number of significant brands, enter the highly desirable and dynamic Irish whiskey category and invest in and grow the value of these brands over the long-term.”
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