Italian Spirits Group Campari has made its most significant deal in history by acquiring Courvoisier Cognac from US-Japanese spirits group Beam Suntory in a substantial USD 1.32 billion transaction. This move comes amid a global slowdown in cognac sales, reflecting the challenges faced by leading cognac makers due to weakening consumer demand.
Courvoisier, ranked as the fourth-largest global cognac producer, will now be integrated into Campari's diverse portfolio, marking the largest-ever acquisition for the Italian spirits group. While the current downturn in cognac sales is acknowledged, Campari's departing CEO, Bob Kunze-Concewitz, expresses confidence in the medium and long-term prospects of the brand.
This strategic acquisition is not only a response to market dynamics but also an opportunity for Campari to strengthen its position in the aged and luxury spirits segments. Kunze-Concewitz considers it a unique and once-in-a-lifetime opportunity, emphasizing the premium quality of Courvoisier.
The deal is anticipated to have a significant impact on Campari's future sales, with Courvoisier expected to contribute 8% to the group's total sales, a substantial increase from the current 1% contributed by Bisquit, another cognac in Campari's portfolio.
As part of Campari's global expansion strategy, this acquisition will enable the spirits group to extend its footprint across the Atlantic, particularly in the US, where 60% of Courvoisier's sales originate. Additionally, it positions Campari for growth in the Asia-Pacific region, where cognac demand is on the rise, and in the UK.
The acquisition of Courvoisier represents Campari's 28th deal under Kunze-Concewitz's leadership, who’s retirement will take effect following the Annual General Meeting scheduled for April 11, 2024 (inside.beer, 12.9.2023). The deal aligns with Campari's track record of successful acquisitions, such as the threefold sales increase experienced by Wild Turkey whiskey since its takeover in 2009.
Despite a recent decline in Campari's share price, this historic deal underscores the company's commitment to strategic growth and market dominance in the competitive spirits industry.