C&C eyes up local booze brands
Conventional wisdom has it that the major players in the booze industry worldwide - Diageo, Allied Domecq, Pernod Ricard, Bacardi and Brown Forman - are increasingly going to focus their attention on a select group of global brands.
That suggests that brands with a purely domestic profile are likely to be divested, creating the opportunities for second-division players like C&C to bid for some of the brands that have become unloved by their head offices.
In Pernod's case, the need to cut debt associated with the Seagrams deal and the plan to concentrate on global brands like Jameson, Chivas Regal, Martell, Seagrams gin and Wyborowa, not to mention its eponymous pastis brands, is leading to increasing speculation that many of the brands below the one-million- cases-a-year threshold will be divested, in the same way that Pernod sold off Orangina and is planning the sale of BWG to Electra Private Equity.
That has led some in the trade to speculate that maybe, just maybe, some of Pernod's non-global Irish Distillers brands like Paddy, John Power or Cork Dry Gin might come on the market in the next couple of years. Richard Burrows would doubtless protest that no divestment of Irish assets is planned but some industry sources point out that these domestic brands hardly fit into the "global" category now so loved by the big booze companies and fit more neatly into the portfolios of the smaller players.
It wouldn't be the first time that Pernod sold an Irish brand. In the mid-1990s, it swapped Tullamore Dew for Allied Domecq's Royal Canadian whisky brand at a time when Allied Domecq was one of the major shareholders in C&C. That deal took place only a few years after Allied Domecq - through C&C - was one of the hostile bidders for Irish Distillers Group (IDG).
Assuming markets don't take a dive in the next few months, C&C will emerge from its leveraged buyout state into a public company with a balance sheet given a massive financial injection from cash raised in the IPO. C&C has made no secret of its wish to pick up some of the "unloved" brands from the major global drinks groups and has bid unsuccessfully for a number of these since its buyout, most recently the Four Roses bourbon brand.
Elsewhere in this newspaper, new C&C chief executive Mr Maurice Pratt is coy about the group's acquisition plans once it has the new-found financial flexibility that plc status brings. Current Account would not be surprised if, in the next couple of years, the Paddy, John Power and/or Cork Dry brands find their way onto the market.
He would also be not surprised if C&C is not at the head of the queue waving a cheque. Tullamore Dew has been very successful for C&C since it bought the brand in 1994 and one of the domestic IDG brands would fit neatly into a drinks portfolio that is still relatively light on spirits.
And while on the subject of booze, Current Account noticed that Allied Domecq has enjoyed a surprise boost to sales of its Courvoisier cognac in the US.
Courvoisier consumption jumped 4.5 per cent in the first part of the year amid the success of rapper Busta Rhymes's Pass the Courvoisier Part Two ditty, currently at number 16 in the Billboard charts.
No, Current Account has never heard of Busta Rhymes or his song either but, in the ferociously competitive booze industry, any assistance is no doubt welcome!