Splash Beverage Group has announced plans to buy Texas-based JEM Beverage Management Company, the owner of vodka brand Western Son.
Florida-based Splash Beverage said today (11 September) it had signed a letter of intent to acquire the business. Financial terms were not disclosed “as they are subject to reaching a definitive agreement”, the publicly-listed group said.
JEM Beverage Management Company owns vodka brand Western Son, as well as a 150,000-square-foot production and distribution “campus” in Pilot Point, Texas. In the past year, it has sold 309,000 nine-litre cases of vodka.
It comes days after Splash Beverage said it was on the look-out for M&A targets with the backing of fresh funding.
In a statement released today, Splash Beverage CEO Robert Nistico said it would provide sales and marketing support to Western Son and Western’s distillery following the deal.
The group will also look to create a centralised production and distribution hub for the flavoured-Tequila brand Salt and sports beverage Tapout, “in addition to any future acquisitions”, at the Pilot Point site.
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This will save logistics costs, reduce freight expenses “and ultimately increase margins”, Nistico said.
“We believe this acquisition will help accelerate both the depth and breadth of distribution for all the brands involved.”
Western Son Vodka president Carlos Guillem said: “Our focus has been on creating and delivering the highest quality vodka to the market, and this represents a major step in our journey. The leadership, expertise, and capital that Splash Beverage can bring to the table will allow Western Son to expand its reach to more consumers.”
New York-listed Splash Beverages markets alcoholic and non-alcoholic drinks. Its existing portfolio also includes the Copa di Vino single-serve wine brand and Madrid-based canned sangria brand Pulpoloco, which it acquired last year.
Outlining the size of assets Splash Beverage would look to acquire last week, Nistico said: “We intend to target brands accretive to Splash with revenues between $20m and $75m, as we believe that is the sweet spot for adding value by folding these brands into our proven management team and our distribution channels.”
He said today Western Son “falls within the range of acquisition targets we outlined in our recent acquisition credit facility announcement as we move down the acquisition path”.