Emperador buys Domecq

Emperador Inc., the world’s largest brandy company owned by Filipino billionaire Andrew Tan, is acquiring Domecq and Don Pedro brandies from Pernod Ricard SA of France.

Pernod Ricard is one of the world’s largest distilled beverage companies that owns major brands, such as Absolut vodka and Chivas Regal scotch.

Emperador said the deal with Pernod Ricard would further strengthen its position as the world’s largest brandy maker.

Emperador said in a statement the latest acquisition would give the company access to the brandy market in Latin America, particularly Mexico where the Domecq brandies accounted for half of the entire brandy market.

“This recent acquisition fits perfectly with our strategy to fortify Emperador’s status as the no.1 brandy company in the world,” said Emperador president Winston Co.

Pernod Ricard said in a statement posted on its website the transaction would include the brand portfolio of Mexican brandies Don Pedro, Presidente and Azteca de Oro and the winery related to the production of Mexican wines in Ensenada, along with the relevant inventories related to the Domecq brands in several markets including Spain, the United States, Belgium and the Netherlands.

Pernod Ricard, which is based in Paris, said it would sell the unit to Bodega Las Copas, a joint venture owned by Emperador and Spanish winery Gonzalez Byass, for an undisclosed price.

More than 500,000 nine-liter cases of Domecq brandy and sherry were sold last year, according to industry tracker IWSR. 

Pernod Ricard said the disposal was in line with its strategy to simplify its portfolio for growth and focus on its priority spirits and wines brands. It reinforces the presence of Bodega Las Copas in the global brandy category.

The closing of the transaction is subject to customary conditions, including its clearance by the Mexican Anti-Trust authorities, and is expected to take place before the end of the fiscal year 2016/2017.

The acquisition came a year after Emperador bought Beam Suntory’s brandy and sherry business in a deal valued at about 275 million euros ($292 million). The deal included Fundador Pedro Domecq, Spain’s largest and oldest brandy.

Emperador also operates a global Scotch whisky business, which Emperador purchased in 2014. 

Whyte and Mackay has a rich heritage of a Scottish spirits, which is the fifth largest Scotch whisky manufacturer in the United Kingdom with prestigious brands such as The Dalmore, Jura Single Malt Whisky, Mackinlay’s Shackleton Malt Whisky, Whyte & Mackay Scotch Whisky and Vladivar Vodka.

Emperador expanded its brand footprint outside the Philippines beginning 2014.

Emperador reported a net income of P4.9 billion in the first nine months, a 5 percent increase from the same period last year on the back of consolidated revenues of P27.9 billion. 

The company earlier said it expected itss international business to grow by double digit over the next three years.

Share price of Emperador on Friday closed at 7.10. With Bloomberg

Topics: Emperador Inc. , Andrew Tan , Domecq , Don Pedro brandies , Pernod Ricard SA of France
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