FRANCE: LVMH sells Pommery to Vranken
French-based luxury goods producer LVMH has sold its Pommery Champagne brand to the Vranken Monopole group, for a price believed to be between €150m and €180m (US$134-161m).
The deal will see the Pommery brand, its site in Reims, its cellars, its Champagne stock and its supply contract pass on to Vranken. However, LVMH will retain the vast majority of the Pommery vineyards, which LVMH called a "strategic asset for the group", in a statement issued yesterday.
Christophe Navarre, president of LVMH's wines and spirits division, said: "This sale results from LVMH's desire to concentrate on its star brands and underlines a determination for the wines and spirits division to focus its resources on its premium brands, which have strong potential."
The acquisition, it is thought, will make Vranken Monopole, which already owns Charles Lafitte, Heidesieck and Co, and Vranken Champagnes, the second-biggest Champagne producer in the world with a 10% share of the world market.
The deal, it is expected, will be finalised by the end of May.
In related news, LVMH also announced an 8% rise in first-quarter revenue, compared to the same period last year. However, the company did rely heavily on newly acquired operations to achieve that growth.
On a like-for-like basis the company could only manage a 3% increase as the duty free and tourist businesses continue to remain flat.
LVMH's revenues were up to €2.96 billion from €2.75 billion in the first quarter of last year, a figure in line with expectations.
Wines and spirits, however, did perform strongly, contributing €457m to revenue, up 19% from €384m last time. In particular there was a general pick-up in the Champagne market following a lengthy post-Millennium hangover.
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