Edgar M. Bronfman, Who Led Seagram For Decades, Passes Away At 84December 22, 2013
Edgar M. Bronfman, who led The Seagram Company Ltd., from the 1950s through the 1980s, died yesterday at his home in Manhattan. He was 84.
Bronfman joined Seagram, the Canadian liquor giant founded in 1926 by his father Sam, at age 21, having just graduated from Montreal’s McGill University. He initially worked as an apprentice taster and accounting clerk and later oversaw production at Seagram’s main distillery just outside Montreal. In 1953, Edgar’s father promoted him to head up Seagram’s U.S. subsidiary, Joseph E. Seagram & Sons, which accounted for the lion’s share of the business. Edgar’s brother Charles took charge of the company’s Canadian branch, the House of Seagram.
Edgar became an American citizen, and by 1958 the company was installed in The Seagram Building on Park Avenue in New York City, a skyscraper that is still considered one of New York’s iconic architectural works. During the 1950s and into the 1960s, Seagram dominated the U.S. drinks landscape like no other company before or since.
But Seagram then began to lose market share, and Bronfman sought diversification. In 1981, the company entered into a bidding war to acquire oil giant Conoco, which it lost to Dupont. But in the process, Seagram ended up with a nearly 25% shareholding in Dupont that proved to be a major windfall. By the mid-1980s, the Dupont stake was accounting for around 75% of Seagram’s earnings.
By this point, Bronfman increasingly had been turning his attention to philanthropic causes. In 1981, he became president of the World Jewish Congress, a position he held until 2007. This was arguably the most celebrated role of his career, as he became a forceful advocate for Jewish rights around the globe. In 1999, Bronfman was awarded the Presidential Medal of Freedom for his service in this cause.
As his philanthropic work expanded, in 1986 Bronfman announced a plan to gradually turn the reins of Seagram over to his second son, Edgar Jr., who assumed the company leadership and officially became president of Seagram in 1989. Under his father’s guidance, Edgar Jr. sought to diversify Seagram away from its traditional focus on whisky—a category whose market share was plummeting at the time—and moved into other drinks categories. In 1988, he engineered Seagram’s $1.2 billion acquisition of Martell Cognac from the Martell family. That same year, Seagram spent $1.2 billion to buy the Tropicana orange juice brand.
Edgar Jr. also went full-tilt into the wine cooler business—a category that was showing rapid growth in the mid-1980s, led by E.&J. Gallo’s Bartles & Jaymes brand. Launching the Seagram’s Coolers brand, Edgar Jr. recruited actor Bruce Willis as pitchman and entered into a fierce battle with Bartles & Jaymes for category leadership, with both brands spending heavily on prime time television ads.
Meanwhile, Seagam continued to focus on non-whisky products like Captain Morgan and Martell and also sold off a slew of low-end brands to focus on the premium end. By the late 1980s, Seagram was no longer the U.S. market’s top spirits player (it had been supplanted by International Distillers & Vintners, today part of Diageo), but its diversification strategy was proving successful and it remained a hugely powerful force in the global spirits and wine business. Seagram’s wine holdings included the Mumm and Perrier-Jouet Champagne brands, and it was by far the world’s top buyer of Bordeaux and other fine wines through its Seagram Chateau & Estate division, led by the legendary Ab Simon.
In 1994, Edgar Jr. scored a major coup when Seagram signed a global marketing accord for Absolut vodka—wresting the brand’s all-important U.S. distribution rights from International Distillers & Vintners in the process. Seagram vowed to diversify Absolut’s export presence away from its dependence on the U.S. market, a goal that was achieved.
While the Absolut deal was a success, 1994 was also the year in which Edgar Jr., with his father’s blessing, sold Seagram’s shares in Dupont and used the $9 billion from the sale to pursue deals in the entertainment business. He bought film and music company MCA, regrouping it into two divisions, Universal Studios and Universal Music.
The Dupont sale proved to be a major strategic error, as Dupont’s stock doubled during the late 1990s stock market boom while Seagram’s share price stagnated. But Edgar Jr. remained determined to steer Seagram into entertainment, acquiring Polygram in 1998—and making it abundantly clear that the drinks side was no longer the top priority. That same year, the Tropicana brand was sold to Pepsico.
The final chapter in the Seagram saga began in 2000, when Edgar Jr. forged a partnership with French conglomerate Vivendi and its president Jean-Marie Messier—an all-stock deal that formed Vivendi Universal, a diversified entertainment-based group led by Messier as chairman and Edgar Jr. as vice chairman. Concurrent with that accord, it was announced that the Seagram drinks business would be sold. Vivendi Universal foundered in 2001 as its stock price nosedived, with Seagram losing control of Vivendi Universal in the process. Edgar Jr. stepped down from the company in 2001. (He went on to lead an acquisition of Warner Music Group in 2004, which was sold in 2011.)
Seagram’s storied liquor business was sold in 2001, in a joint acquisition by Diageo and Pernod Ricard. Diageo gained key spirits brands including Captain Morgan, Crown Royal, Seagram’s 7 Crown and Bulleit, while Pernod Ricard won Chivas Regal, The Glenlivet, Martell Cognac and Seagram’s Gin, among others. Absolut’s U.S. marketing rights moved to a joint venture between Beam Inc. and Absolut’s then-owner, Swedish spirits monopoly V&S Vin & Sprit. (Absolut was acquired by Pernod Ricard in 2009.)
Edgar M. Bronfman is survived by his wife, Jan Aronson; children Samuel, Edgar Jr., Matthew, Adam and Holly from his first marriage; daughters Sara Igtet and Clare from his third marriage; his brother Charles and sister Phyllis Lambert; and 24 grandchildren and two great-grandchildren.Subscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning.