Campari acquires Forty Creek for €120.5mBy Amy Hopkins
Italian drinks group Gruppo Campari has entered the Canadian whisky market with its €120.5 million acquisition of Forty Creek Distillery.
Under the agreement, Campari will own 100% of the independent Canadian spirits company and its flagship brand Forty Creek Whisky – said to be the fastest growing brand in the Canadian whisky category.
Campari will take control of the complete portfolio of Forty Creek Distillery, which includes whisky, vodka, rum and liqueur brands.
The company’s whisky portfolio is comprised of Barrel Select, Copper Pot Reserve, and Forty Creek Cream Whisky, as well as limited releases including Forty Creek Confederation Oak, Double Barrel and an annual special John K. Hall Reserve release.
The deal also includes the acquisition of stocks, the distillery itself, manufacturing facilities and a hospitality centre in Ontario.
“With Forty Creek Distillery, we are once again leveraging our acquisition framework in a very disciplined and consistent manner for long-term growth,” said Bob Kunze-Concewitz, CEO of Gruppo Campari.
“Via the entry to the large and growing Canadian Whisky segment this acquisition further increases our exposure to the highly attractive brown spirits category whilst continuing to enhance our premium portfolio.”
Kunze-Concewitz added that the acquisition will allow the group the accelerate growth in the US and Canada. He also said the Forty Creek whisky brands will benefit from Campari’s global routes to market strategies, which will allow them to extend their presence beyond their core US market.
The group also said that the purchase is a “perfect fit” with its acquisition strategy.
Forty Creek Distillery’s chairman and head whisky maker John Hall will remain in position with the company, while its business structures and process will also remain unchanged.
“I believe this opportunity will further support Forty Creek’s vision to produce unique, quality, handcrafted, Canadian-made spirits,” he said.
“Campari has the global ability to take Forty Creek to the next level. Introducing customers around the world to my whisky is a dream come true.”
In fiscal year ending 31 March 2013, Forty Creek Distillery achieved total net sales of CAD$34.2m, of which Forty Creek Whisky represents around 62%. The company is expected to post a 16% increase in sales for the fiscal year ending 31 March 2014, reaching CAD$39.5m.
The acquisition is expected to complete on 2 June 2014.
Campari also recently announced that it would be re-entering the Irish whiskey market with the launch of Irish Mist whiskey.
The Italian group reported net sales increased by 13% to €698.6m in H1 2013 in August last year, buoyed by the positive contribution of the Lascelles deMercado buyout in 2012.