Bacardi moves distribution to new heavyweight

Bacardi has confirmed it is to move the majority of its North American distribution contracts to a new company formed by the integration of Southern Wine & Spirits and Glazer’s.

Bacardi’s brands will now be distributed by newly formed Southern Glazer’s Wine & Spirits in the US and Canada

Yesterday, family-run distributors Southern Wine & Spirits of America and Glazer’s revealed they had signed an agreement to form Southern Glazer’s Wine & Spirits – now the largest wine and spirits distribution firm in North America.

The company will distribute more than 150 million cases of wine and spirits annually, covering nearly 90% of legal drinking age population in the US.

Headquartered in Miami, Florida, and with “significant ongoing operations” in Dallas, Texas, it will employ more than 20,000 members of staff and have operations in 41 states, in addition to the District of Colombia, the Caribbean and Canada.

The company is majority-owned by Southern Wine & Spirits Holding Company, the largest wine and spirits wholesaler in the US, but will be led by an executive team and board of directors composed of representatives from both Southern and Glazer’s, the fourth largest industry wholesaler.

Harvey R. Chaplin, of Southern, will serve as chairman of the board, and Bennett Glazer, of Glazer’s, will serve as executive vice-chairman of the board.

Wayne E. Chaplin, of Southern, will serve as CEO of Southern Glazer’s Wine & Spirits and will be responsible for setting the company’s overall strategic direction and day-to-day commercial and operational execution.

Sheldon ‘Shelly’ Stein, of Glazer’s, will serve as president of the new company with responsibility for leading business development, merger and acquisition activities, long-term global growth, and will assist with strategic direction.

Industry leader

“The combination of two of the wine and spirits industry’s leading distributors will create unmatched value for our business partners and position us for broader supplier alignments, which will translate into even greater opportunities for our team members,” said Wayne. E Chaplin.

“Southern and Glazer’s have highly complementary cultures marked by an uncompromising commitment to superior service, driven by the most talented and experienced teams in the industry.

“Our new company will have the exceptional opportunity to build a combined organisation that capitalizes on the extraordinary legacies and best practices of both companies. Quite simply, we will have the best team and the most extensive reach in the business.”

The majority of Glazer’s malt beverage distribution business, including MillerCoors, will not integrate into the new business and will operate as a separate company, called Glazer’s Beer & Beverage.

The merger and subsequent creation of Southern Glazer’s Wine & Spirits is expected to be completed in the second quarter of 2016.

Days after legal documents revealed Bacardi’s intention to terminate a plethora of its long-running distribution agreements in the US, the producer has formally announced that Southern Glazer’s will create a regional distribution network for its brands in North America.

Operating across open and control states, with support from select franchise distributors, Southern Glazer’s will handle Bacardi’s brands in more than 40 markets.

“The Bacardi company is grateful to all of our distributors for the many years our relationship has existed,” said Michael Dolan, chief executive officer of Bacardi Limited.

“As we continue on our journey, we recognise the need to be effective in all channels of the business as retailers and consumers have evolved. We selected Southern and Glazer’s because of their expertise, national footprint and expressed dedication to the service of our iconic brands.”

Bacardi has submitted applications to terminate its distribution agreements with the newly formed Breakthru Beverage Group, Alliance Spirits & Wine and Young’s Market Company, along with around 20 others.