News Briefs for June 27, 2012
June 27, 2012•Anheuser-Busch InBev (ABI) could spend as much as $20 billion to acquire the 50% stake in Mexico’s Grupo Modelo that it doesn’t already own, Bloomberg reports. That sum, quoted by an unnamed source, would include a payment to buy Constellation Brands out of Crown Imports, its U.S. joint venture with Modelo. The source added that while nothing has been finalized, a deal could be announced as early as this week. Credit Suisse analysts estimated that it would cost ABI around $1.7 billion to acquire Constellation’s stake in the Crown joint venture, which expires at the end of 2016. Crown boasts three of the top seven imported beer brands in the U.S.—Corona Extra, Modelo Especial and Corona Light, which combine for 12.5 million hectoliters (147 million 2.25-gallon cases) annually, according to Impact Databank.
•Diageo has launched new premixed cocktails in frozen pouches under the Parrot Bay and Smirnoff brand names. The new offerings are at 5% abv and retail for $1.99 a 10-ounce pouch. Parrot Bay’s frozen pouch flavors include Strawberry Daiquiri, Mango Daiquiri and Piña Colada, while Smirnoff’s line is comprised of Strawberry Lemonade, Blue Raspberry Lemonade and Cherry Limeade. Diageo suggests freezing the pouches overnight and enjoying them by squeezing into a glass the next day. One key competitor in the segment is Daily’s (American Beverage Corp.), which recently filed a federal trademark lawsuit against Diageo claiming the new Parrot Bay frozen pouches are too similar to the Daily’s design.
•Ireland-based beer and cider producer C&C Group said rising exports to North America were among the bright spots in an otherwise challenging first quarter ended May 31. C&C’s export volume was up 63%, while revenue rose 47% during the period, boosted by the group’s recent addition of Hornsby’s cider, acquired in February from E&J Gallo for $23 million. Hornsby’s does around 700,000 cases in the U.S. annually, while C&C’s Magners brand does around 580,000 cases. Meanwhile, C&C’s Tennent’s beer brand was launched in North America during the quarter, and the company said “initial feedback was positive.” The Irish group’s increasing presence in North America, Australia and other export markets has helped blunt the impact of continuing difficult conditions in its core Ireland and U.K. markets, where net revenue was down 12% and 25% respectively during the quarter.
•E&J Gallo Winery’s Turning Leaf brand has announced the national rollout of Refresh by Turning Leaf, a lightly sparkling wine with lighter style position. Refresh by Turning Leaf is available in three versions—Crisp White, Moscato and Red Moscato—and retails for $8 a 750-ml.
•Hess Shirtail Creek Chardonnay from Hess Family Estates is now available on tap in California. The on-premise-only wine is packaged in barrels that hold the equivalent of 26 (750-ml.) bottles, or 130 five-ounce pours, wholesale priced at $211 a barrel. The barrel system is provided by Free Flow Wines and is being distributed in California by Young’s Market Company. Hess plans to enter Arizona and Las Vegas with concept later this year. It also expects to begin offering Artezin Mendocino Zinfandel with same system in the fall. Shirtail Creek Chardonnay is also available in 750-ml. screwcap bottles.
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Tagged : ABI, Crown Imports, E&J Gallo, Grupo Modelo
