Italian branded beverage group Gruppo Campari SpA on Monday said it would buy Jamaica’s rum maker Lascelles deMercado & Co Limited (JAM:LAS), or LdM, in a deal worth USD414.75m (EUR330m) that would see it enter the large and attractive rum sector.
Under the terms of the transaction, Campari will buy 81.4% in LdM from members of the CL Financial Limited group of companies and the rest from the target’s public shareholders via a formal bid at a price of USD4.32 per ordinary share and USD0.57 per preference share, the buyer said.
The price will be covered with bank debt.
The acquisition will add top premium rum brands to its portfolio, including rum range, including Appleton Estate, Appleton Special/White, Wray & Nephew and Coruba, while boosting its critical mass in the key US, Canada, Mexico, the Caribbean markets and securing a top position in Jamaica.
With this deal, the Italian group also grows its business outside the home market and strengthens its spirits segment, its largest and most profitable business, it said.
The agreement includes LdM’s spirits business, the related upstream supply chain, as well as its local consumer products distribution business.
This transaction is Campari’s third largest deal in its history, giving it a top position among the global premium rum producers, it said, adding that it sees it to contribute to its earnings from the first year of ownership.
Completion is expected in the fourth quarter of this year, pending conditions.
The business to be bought generated pro-forma sales of USD277m and pro-forma EBITDA of USD27.7m in the 12 months to 30 June 2012.
Bank of America Merrill Lynch and Morrison & Foerster LLP acted a advisors Campari.