Monday, 13 January 2014

Suntory of Japan is buying Jim Beam

What does this mean? More concentration in the spirits business and probably more pricing power for the acquiring company.
The motivation for the Japanese company in buying the US company for USD 16 billion is fourfold:
Suntory buying Jim Beam is a huge acquisition

1. Joining the big league 
The deal will make Suntory the world’s third-largest maker of distilled drinks with strength in Bourbon, Scotch, Canadian, Irish and Japanese whiskies with combined annual sales of spirits of more than $4.3bn to rival Diageo and Pernod Ricard.

2. Suntory less focused on Japan 
About two-thirds of Suntory’s sales are in Japan – and are growing at just 3 per cent a year. Buying Beam will help the Japanese group counter the decline in its domestic market, whose shrinking population has intensified competition.

3. Exposure to the US market 

The deal gives Suntory instant access to the US, the world’s largest spirits market, and could help it achieve its goal of annual sales of Y2tn ($19bn) by 2020.

4. Raises international profile 
Best-known outside Japan for its Orangina Schweppes business and its recent acquisition of Ribena and Lucozade, Suntory will now be able to boast some of the world’s most sought-after spirits’ brands, including Jim Beam, Teacher’s and Laphroaig Scotch whiskies as well as, Canadian Club whisky and Courvoisier cognac.




The corporations behind the world's great whiskies


Familiar brands that fall under the Suntory banner:

Canadian Club

Maker's Mark
Laphroaig
Teacher's
Knob Creek
Sauza
Pinnacle Vodka
Suntory Whisky Hibiki 

(Source: Financial Times

Arijit Banik for Sukasa Style


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