Beam to Still Irish Whiskey - Analyst Blog
19 Dezember 2011 - 5:51PM
Zacks
Spun off of Fortune Brands, liquor producer Beam
Inc. (BEAM) will buy renowned Irish whiskey maker Cooley
Distillery. Per the deal, Beam will gain control of this leading
spirits company for about $95 million on a debt-free basis.
Under the transaction, Beam will offer Cooley shareholders $8.25
in cash in exchange of every Cooley share. Depending on the
acceptance of a minimum of 80% Cooley shareholders and other
customary conditions, the companies expect to close the transaction
in the first quarter of 2012.
Beam’s deal with Cooley, one of the only three sources for Irish
whiskey and the only independent player, provides a solid gateway
for Beam’s entry into one of the spirits industry's highest growth
categories. The Irish whiskey category grew 11.5% in 2010 to 4.86
million cases, according to Impact Databank.
Product portfolio of the Irish distillery includes Kilbeggan
Irish whiskey, Tyrconnell Single Malt, Connemara Peated Single Malt
and Greenore Single Grain Irish whiskey. Cooley’s sales for 2010
reached nearly 250,000 9-liter cases per year including its brands,
private label products and bulk sales to third-party customers.
Beam’s brands include Jim Beam Bourbon, Maker's Mark Bourbon,
Sauza Tequila, Canadian Club Whiskey, Courvoisier Cognac, Teacher's
Scotch Whisky, Laphroaig Scotch Whisky, Cruzan Rum, Hornitos
Tequila, Knob Creek Bourbon, EFFEN Vodka, Pucker Flavored Vodka,
Larios Gin, Whisky DYC, DeKuyper Cordials, and Skinnygirl
Cocktails.
The company expects earnings from the addition of Cooley’s
brands to increasingly reflect in Beam’s financial statements after
2012. The acquisition will have no impact on fiscal 2012
earnings.
Deerfield, Illinois-based spirits giant Beam engages in
producing and selling branded distilled spirits products worldwide.
The company’s portfolio includes 10 of the world’s top 100 premium
spirits brands and some of the industry’s fastest growing
innovations.
Worldwide, the company generated 2010 sales of about $2.7
billion on volume of 33 million 9-liter cases. Beam was formerly
part of Fortune Brands, which separated into two publicly traded
companies, Beam Inc. and Fortune Brands Home & Security
Inc. (FBHS).
Currently, Beam has a Zacks #2 Rank, implying a short-term Buy
rating on the stock. However, the company retains a long-term
Neutral recommendation. The company competes with well-established
players, such as Diageo plc (DEO) and
Brown-Forman Corporation (BF.B).
BEAM INC (BEAM): Free Stock Analysis Report
BROWN FORMAN B (BF.B): Free Stock Analysis Report
DIAGEO PLC-ADR (DEO): Free Stock Analysis Report
FORTUNE BRD H&S (FBHS): Free Stock Analysis Report
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