Ireland's C&C, of Magners and Hornsby's, will buy U.S. cider firm Vermont Hard Cider Company for $305 million USD (not euro like some financial press have reported). The transaction "will allow the company to fully harness and maximize the growth of its U.S. cider business," per company statement. Vermont Hard Cider chief Bret Williams told BBD they're hopeful the transaction will be completed in 30 days.
The Woodchuck brand "will remain firmly rooted in Vermont, utilizing its current workforce," according to company statement. Bret will stay on as CEO in the deal, and Vermont Hard Cider Company will operate on a standalone basis as a wholly-owned subsidiary of C&C. Bret and Vermont CFO/VP operations Dan Rowell will become shareholders in C&C Group.
"We have acquired Hornsby's last year, as a California based cider; we're importing Magners for the last 10 years in the states," C&C managing director Joris Brams told BBD. "And all our heritage comes from Ireland, England and Scotland ... so we're experiencing an enormous uplift of the cider market. Acquiring Woodhcuck would be a nice fit onto our portfolio to explore future growth.
"The cider category is still very small in the U.S.; penetration as a percentage of the beer category is only 0.2%. This, compared to Ireland where it is 10% and England where it is 15%, only shows the huge potential that is still possible. .. putting that in perspective [equals] quite an enormous potential and future value. Therefore we're happy not only to acquire the brands, but the assets and people who made that happen." He assured that "this is not a story of cost saving and us trying to find solutions for synergies; it's a story of growth."
For their part, C&C said the transaction accelerates their growth prospects via "increased exposure to the high-growth U.S. cider category, which grew approximately 60% in the first 6 months of 2012." Woodchuck Hard Cider's growth continues at 25% a year.
Bret recalled how his company was losing $300,000 a month back in 2003, with flat sales. "It was all about the malternative segments back then; cider was an afterthought. The goal was never to make a buck. What motivated me to [turn the company around] was to save jobs." This year they'll do $70 million in revenue with no debt, and 125 employees; "the company has never been healthier," said Bret.
Until tomorrow, Harry
"Time flies like an arrow. Fruit flies like a banana."
Groucho Marx (1890 - 1977)
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