France: Pernod Ricard sells Wild Turkey to Campari

08 April, 2009

France: Pernod Ricard has announced the sale of its Wild Turkey bourbon to Gruppo Campari for US$ 575 million.

France: Pernod Ricard has announced the sale of its Wild Turkey bourbon to Gruppo Campari for US$ 575 million.

The sale brings the total to nearly 60% of the €1 billion non-strategic assets disposal plan announced in July 2008.

The transaction includes the Wild Turkey brands, along with American Honey liqueur, distillery facilities in Kentucky and related assets, together with aged bulk bourbon inventory.  It also provides that Pernod Ricard will continue to distribute the Wild Turkey brands in Australia and New Zealand, for a transitory period, and in Japan, the second largest non-US market, pursuant to distribution agreements with Campari. The price represents 10 times the brand’s historic contribution after advertising and promotion. 

The sale of Wild Turkey is an important part of the €1 billion disposal plan of non strategic assets communicated after the Vin & Sprit acquisition. With the disposals of Glendronach, Cruzan, Bisquit, as well as of the Serkova and Vin & Sprit brands sold at the request of the competition authorities, the overall disposal gross proceeds reach approximately € 577 million as of today. The Group confirms its intention to complete this plan within 12 months.

The transaction is subject to antitrust approvals and is expected to close in the second quarter. BNP Paribas and J.P. Morgan acted as financial advisors to Pernod Ricard and Debevoise & Plimpton LLP acted as legal advisor.

As authorised by the tenth resolution voted at the November 7th, 2007 annual general meeting of shareholders, Pernod Ricard has announced its intention to raise €1 billion in equity capital by way of a rights issue in order to enable existing shareholders to support the Group and preserve their interests. Proceeds will be used to pay down debt and address the major part of its refinancing needs until July 2013.

Besides, the rights issue will allow for quicker decrease of the Group’s Net Debt /EBITDA ratio which will further reduce the syndicated loan margins. 
Société Anonyme Paul Ricard and its subsidiary Lirix have confirmed their support to the rights issue and will subscribe through a cash-neutral transaction (“opération blanche”).

Groupe Bruxelles Lambert has also signaled its confidence in the Group’s outlook by indicating its intention to fully subscribe to its pro rata share of the rights issue.

A group of banks is currently advising Pernod Ricard in connection with the rights issue, which it intends to launch as soon as possible, subject to both market conditions and agreement on final terms by the Board of Directors. It is also subject to the granting of a visa by the French market regulator AMF on the related prospectus. 

Pierre Pringuet, Chief Executive Officer, said: “Confirmation of our target for strong growth in net income despite current environment demonstrates Pernod Ricard’s resilient business profile”. He added: “By accelerating its deleveraging plan, Pernod Ricard will enhance its financial flexibility for growth”.


Digital Edition

Drinks International digital edition is available ahead of the printed magazine. Don’t miss out, make sure you subscribe today to access the digital edition and all archived editions of Drinks International as part of your subscription.


Nick Strangeway

How the industry has changed since travel limits

Nick Strangeway looks at how travel restrictions have left a permanent impression on the global bar trade.