Gruppo Campari has made a "strategic addition" to its portfolio.

The Italian company confirmed yesterday (7 May), that it is to acquire an 80% stake in Cabo Wabo Tequila from rock star Sammy Hagar. Campari will buy the controlling stake for US$80m in cash, the equivalent of 11.8 times Cabo Wabo's expected EBITDA this year.

"Cabo Wabo is a strategic acquisition for Gruppo Campari as it significantly contributes to build our diverse portfolio of ultra premium brands in the US", said Enzo Visone, CEO of Campari. "We are proud to have concluded another important deal that not only enables us to further strengthen our position in the US ultra premium spirits market, but also to increase Gruppo Campari's focus in tequila by owning a brand in a very important and growing category."

Founded in 1996 by Hagar, Cabo Wabo arrived in the US in 1998. The brand has a volume of approximately 70,000 nine-litre cases, mainly sold in the US, Campari noted.

"When I created Cabo Wabo, I never dreamed that it would be received so well by my fans and people who really love good Tequila," said Hagar. "While I am proud of its success, it's time to let the world have a shot at the best Tequila on the planet and Gruppo Campari can help take us there."

Hagar and his associate Marco Monroy, will hold the remaining 20% share, although Campari will have the option on buying their stake in two tranches of 15% and 5% through call / put options to be exercised in 2012 and 2015 respectively.

The transaction is anticipated to close in January next year.