Italy’s Campari Group has committed to buy premium Cognac house Courvoisier from Beam Suntory in a landmark deal, according to a Thursday press release from the brand. The purchase price for the acquisition is set at $1.2 billion. An additional payment of $120 million is expected to be payable in 2029 if the net sales target is reached in 2028, potentially giving the acquisition a value of $1.32 billion — the largest deal in Campari Group’s history.
Founded in 1828, Courvoisier is one of France’s top four historical Cognac houses, making this a unique opportunity for Campari Group to enter the realm of super-premium Cognac. This purchase is in line with Campari Group’s strategy to expand its portfolio of global offerings and improve its luxury offerings in key markets including the U.S. and Asia.
“Courvoisier will enable a significant step up in the U.S. while also permitting long-term transformational potential in the strategic Asia-Pacific region,” Matteo Fantacchiotti, deputy chief executive officer of Campari Group says in the release. “In addition to acquiring a globally recognized brand with strong premiumisation credentials, we have a unique opportunity to expand our Cognac production and bottling capacity in France, a core platform of our global supply chain.”
This is the Italian group’s seventh acquisition of a France-based spirits producer since 2016, including those of Bisquit & Dubouché and Grand Marnier. This purchase will increase the group’s distilling infrastructure and bottling and warehousing capabilities in France. This is another benefit to the Courvoisier brand which will be able to leverage Campari Group’s leadership, brand development, and operational infrastructure.
“Our recent investments into business infrastructure and enhanced operation capabilities, combined with Campari Group’s formidable reputation for investing in brands with strong equity and potential for long-term sustainable growth will allow us to unlock Courvoisier’s full potential,” Fantacchiotti adds.
The timing of this deal might come as a surprise to some, as Cognac producers recently reported dwindling sales and lackluster consumer demand. But Campari chief executive Bob Kunze-Concewitz told the Financial Times that Cognac’s slump was almost certainly temporary, and the Campari Group is optimistic about the future of the Courvoisier brand.
“This year Cognac players have a problem because there was scarcity during the pandemic, so distributors built stock… inflation and interest rates rose and players increased the prices, the macro scenario crisis affected consumption and distributors ended up with large stocks,” Kunze-Concewitz told the publication. “But people have a short memory… Cognac in the U.S. is now a lot more popular than it was before the pandemic, in spite of the [current decline in sales].”
Courvoisier reported net sales of $249 million in 2022, 60 percent of which in the U.S. This acquisition marks a promising future for luxury Cognac, and is poised to provide the perfect opportunity for the Campari Group to progress in its premiumization journey.
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