Campari Group swoops for Picon brand in US$125m deal with Diageo

Early on in the month, Campari Group announced the acquisition of French flavoured liqueur brand Picon from Diageo for a sum in the region of EUR119m (US$125m). The bittersweet orange aperitif brand will join the Campari portfolio, as the group looks to strengthen its position in the French market.

Just Drinks thinks: In recent years, Campari has found success in acquiring and breathing new life into slightly tired, dusty brands such as Wild Turkey, Appleton Estate and Grand Marnier. This latest acquisition follows a similar pattern, which the Milan-headquartered group no doubt hopes will help it find success in the French domestic market, where much of its recent M&A activity has centered.

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From the outside, Picon looks like a brand in much need of some TLC. Indeed, the only reference to be found to the brand anywhere on Diageo’s website was in the press release announcing its sale. What price do you put on a brand you found tucked away down the back of sofa? A cool US$125m, apparently.

Nonetheless, Campari clearly sees Picon’s potential both domestically and overseas, with CEO Bob Kunze Concewitz telling Just Drinks he sees the brand having “value to resonate on a wider international level.”

More on this topic: What is Picon and why has Campari Group acquired the brand?

Diageo’s United Spirits sells clutch of brands in India to Inbrew Holdings

United Spirits, the Indian group majority-owned by Diageo, has agreed to the sale and franchising of more than 40 brands in the country to Inbrew Holdings.

The deal, expected to be completed by the end of September, sees 32 brands in United Spirits’ so-called “popular” portfolio – such as White-Mischief, Haywards, Old Tavern and Honey Bee – sold to Inbrew. Included in the proposed agreement is the franchising of another 11 brands, notably Bagpiper whisky, for five years.

Just Drinks thinks: After much fanfare, Diageo’s United Spirits division finally completed its long-awaited review of brands in its “popular” portfolio earlier this year. The result sees a slew of its low-value brands cast aside, with another near-dozen more franchised out for the foreseeable. The decision makes sense, given current premiumisation trends in the Indian spirits market, which is set to be worth US$49.6bn by 2026, according to GlobalData.

Diageo’s United Spirits unit has already been busy doing some trading up of its own, spending US$4.1m on a 22.5% stake in New-Dehli headquartered craft gin distiller Nao-Spirits in March. Gin, in particular, looks set to be a key battleground for spirits brand owners in India in the years to come – with the category growing at a CAGR of 3.62% in value terms between 2022-2026.

More on this topic: Beam Suntory readies Sipsmith for India – Gin & genever in India data

Maui Brewing Co makes move for Modern Times Brewing

Maui Brewing Co has lined up a bid to acquire ailing San Diageo craft brewer Modern Times.

The Hawaii-based company, which is the 43rd largest craft brewer in the US according to The Brewers Association, intends to make a play to buy Modern Times at auction next month.

Just Drinks thinks: Whilst Modern Times might be relatively small-fry compared to some of the bigger brands on the multinational drinks stage, the travails of the San Diageo craft brewer have caught our eye, not least because they serve as an example of how quickly fortunes in the category can shift.

It wasn’t so long ago that Modern Times was held up as the shining light of everything attractive about craft beer – a rapidly-growing, employee-owned business at the forefront of industry trends. Fast forward a few years, however, and the brand is in a sorry state. Last year, the brewer’s CEO was forced to stand down over allegations of sexual misconduct, while it has also shrunk its domestic footprint, citing a lack of footfall as the reason for closing sites in Los Angeles, Oakland, Portland, and Santa Barbara. The cherry on top of the rotting cake? A court-ordered offload, brought on by its bank’s concerns over the state of its finances.

Despite this recent hardship, Maui Brewing Co – assuming the Hawaii-based company is successful in its bid – is a relatively safe pair of hands for the Modern Times brand. There’s no suggestion the Maui Hard Seltzer brand owner wants to strip the Californian company of its assets, meaning the option of the brewer being disassembled and sold off piece by piece now seems unlikely. The reported offer stands at US$7.6m, a far cry from the US$264m valuation of San Diageo brewer gave itself in a crowdfunding round in 2019.

More on this topic: How craft beer can work through its #MeToo moment

Other notable deals in the global beverage industry this month:

Russian watchdog approves sale of PepsiCo’s Wimm-Bill-Dann Beverages

Heineken’s Lagunitas Brewing Co offloads Moonlight Brewing Co stake

Butterfly Equity extends Bolthouse Farms beverage offering with Evolution Fresh acquisition

C&C Group offloads on-premise outlets in UK as fiscal-full-year- sales soar – results

Casella Family Brands confirms vineyard consolidation in Australia

Bishop Cider Co to acquire Wild Acre Brewing, Legal Draft Beer Co

Further data:

Deals in beverages – Geographical locations in Q1 2022 – data