© Distillerie Franciacorta
Stock Spirits has reached a deal to acquire Italy’s Distillerie Franciacorta, one of the leading producers of grappa, liqueurs and Franciacorta – a premium Italian sparkling wine that is produced solely in the eponymous region of northern Italy.
As well as Franciacorta’s spirits and liqueurs business, the acquisition includes land for the construction of a new production facility.
The purchase price is up to €23.5 million for the business with a further €3 million for the land, payable in cash in three tranches: an initial payment of €3 million on signing, a further €21.5 million payable at completion, and up to €2 million deferred consideration payable over a four-year period.
The rationale for the deal is clear: the grappa category is Italy’s fourth largest spirits category, and the total premium price segments in which the Franciacorta brands are positioned grew by 5.0% in value from 2016 to 2017, Stock Spirits said. The acquisition will mean that Stock is the number one branded grappa business by value in the Italian off-trade, and offers “clear synergies” with the rest of Stock Spirits’ existing portfolio.
Mirek Stachowicz, chief executive of Stock Spirits, said: “We are delighted to be acquiring Distillerie Franciacorta, which is a business with a fantastic heritage and outstanding brands. This is a truly compelling opportunity that we have been looking at for more than a year now, and we see clear and attractive synergies with our existing Italian operations. Distillerie Franciacorta’s deep expertise in local, premium products resonates strongly with Stock Spirits’ wider strategy of investing in well-loved national brands with genuine and high-quality provenance.
“This is our first step in pursuing in-market consolidation opportunities in Italy, and Distillerie Franciacorta will strengthen our position in what is a fragmented but highly attractive market for us. It should also be seen as a clear reflection of our willingness to undertake value-creating M&A as part of our four-pillar growth strategy.”
Distillerie Franciacorta’s Stefano Gozio added: “We are delighted that a business that so clearly understands our values, brands and heritage is acquiring Distillerie Franciacorta. Mirek and his team at Stock Spirits have made it clear that they will nurture and grow the Franciacorta brands, and that they realise the importance of maintaining production locally. We are thrilled to be joining their operations, and look forward to an exciting new chapter for everyone associated with Distillerie Franciacorta.”
Gozio, part of the family that currently owns Distillerie Franciacorta, will remain with the business as a brand ambassador and consultant.
Franciacorta achieved sales in 2018 of €9.7 million as well as pro-forma operating profit – as if it had been under Stock Spirits’ ownership during that time, and excluding one-off acquisitions and integration costs – of €2 million.
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