India consuming wine, Campari buys Grand Marnier

Top cocktail

The Italian Davide Campari-Milano SpA group has made a €684 million ($1.02 billion) bid for the Marnier-Lapostolle family-owned Grand Marnier Group. The bid is 60 per cent higher than Grand Marnier’s closing price in Paris on Friday, March 11.

Grand Marnier’s sales have stagnated over the past decade. Last year they were €152 million whereas a decade ago they were €138 million. That’s not even keeping up with inflation. Half the company’s sales are in the US. Campari expects the purchase will add to profit immediately on a full-year basis.

The Campari group also own Cinzano, Skyy Vodka, Appleton Estate Rum, Wild Turkey Bourbon and a host of other brands including Sella & Mosca wines in Sardinia. A large concern, with 550 hectares of vineyards, Sella & Mosca makes a wide range of wines including the traditional vermentino and cannonau.

As well as Grand Marnier – a blend of cognac and distilled essence of tropical oranges created in 1880 by Louis-Alexandre Marnier Lapostolle – the Grand Marnier Group produces straight cognac, Armagnac, Pineau des Charentes and wine from Loire-based Château de Sancerre and the Chilean winery Casa Lapostolle, with 57 planted hectares in the Casablanca Valley.

Campari is gaining some weight. The 2015 year-end showed sales of €1.657 billion, returning a net profit of €185.9 million.

Not roaring

Lion New Zealand, part of the Japanese Kirin empire, is not having a good time, having posted a 21 per cent fall in full-year earnings to September 30.

  • Sales: NZ$535 million ($475 million), down 5.2 per cent
  • Pre-tax earnings: NZ$55.6 million, down from NZ$71.2 million

Part of the reason is the rise of craft beer in New Zealand. New Zealanders are also drinking less, with the total market for alcohol at its lowest level for 18 years.

Drinkers of Pune

The Times of India (8 March) reports on the drinking habits of the citizens of the city of Pune in the Indian state of Maharashtra. All forms of alcohol sales are up and wine is leading the way.

Wine sales rose 15.97 per cent between April and January, beer sales are up by 9.63 per cent, while sale of liquors sold under the IMFL (Indian-made foreign liquor, the official term used by governments, businesses and media in India to refer to all types of hard liquor manufactured in the country, other than indigenous alcoholic beverages) category were up by 11.63 per cent, according to the state excise department’s latest data. Sources in the industry said the trend was likely to continue for the remaining two months of the year.

India is starting to get the wine bug, worth keeping an eye on but not rushing into. Large supermarket groups such as Tesco and Walmart are looking to expand into the Indian market but it’s proving difficult as the majority of Indians prefer to shop daily at the corner store.

The other issue in India is taxation, it changes from state to state and it’s expected to protect its own wine industry which is in growth.

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