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Campari agrees to acquire Grand Marnier for US$760m
[LONDON] Davide Campari-Milano SpA, the Italian distiller, agreed to buy French cognac maker Grand Marnier Group in a deal that values the company at 684 million euros (US$760 million).
Grand Marnier investors will get 8,050 euros in cash per share, plus a possible payment related to the planned sale of real estate property, Campari said in a statement Tuesday. That's 60 per cent higher than Friday's closing price. Paris- based Grand Marnier's shares were suspended Monday ahead of the announcement.
"Grand Marnier is a French icon, with a rich 150-year history for which we have profound respect," Campari Chief Executive Officer Bob Kunze-Concewitz said in the statement.
Grand Marnier, which produces cognac, Armagnac, pineau and wines, had been working with Rothschild to explore strategic options for the business including a sale, people with knowledge of the matter said in November.
Campari said the purchase will add to profit immediately on a pro-forma full-year basis. The Italian company said the price implies an enterprise value that's 13.7 times Grand Marnier's adjusted 2015 operating profit.
Grand Marnier was founded in 1827 by Jean-Baptiste Lapostolle, who started a distillery producing fruit liquors. Its flagship cognac is often used to make Cosmopolitan cocktails, favored by "Sex and the City" character Carrie Bradshaw and singer Madonna. The company generates about 140 million euros in annual sales, more than half of which comes from the US.
Bank of America Merrill Lynch and Philippe Villin advised Campari on the transaction, with CACIB as joint financial adviser.