C&C Agrees To Acquire Vermont Hard Cider To Become Category’s Dominant Player

Ireland’s C&C Group has agreed to acquire Vermont Hard Cider Co. for $305 million in a deal that will make C&C the dominant player in the fast-growing U.S. cider market. In 2011, U.S. cider sales jumped by 23% to 5.7 million (2.25-gallon) cases. The growth was driven largely by Vermont Hard Cider’s Woodchuck—by far the market’s top-selling cider brand—which advanced by 33% last year and now comprises more than 35% of category sales. Vermont’s other cider brands—Wyder’s and Woodpecker—together account for around 5% of U.S. cider sales, bringing the company’s total market share to approximately 40%.

Vermont Hard Cider’s impressive performance has continued in 2012. After posting a pretax profit of roughly $10 million last year, the Middlebury, Vermont-based company has projected a 50% profit hike in the current year.

C&C, meanwhile, has a 22% share of the U.S. cider market. Last year, it acquired Hornsby’s, the category’s third-leading brand, from E.&J. Gallo, for $23 million. C&C also owns the market’s fourth-biggest brand, Magners. C&C said it would finance the deal for Vermont Hard Cider through existing cash reserves and bank loan facilities. The transaction is expected to close early next year. However, with the combined companies owning three of the market’s top four cider brands and possessing an aggregate market share of more than 60%, regulatory authorities may be looking at the deal closely.

Tagged : cider

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