Campari to buy Canadian whisky company for $170 million
MILAN (Reuters) - Drinks group Campari CPRI.MI has agreed to buy Canada's Forty Creek Distillery (FCD) for 185.6 million Canadian dollars ($170 million), the Italian company said on Wednesday.
Campari, famous for its bitter red aperitif of the same name, said that whiskey company FCD will give it the opportunity to grow in the United States, where it expects a revival in sales of brown spirits.
"The addition of FCD will enable us to further build our critical mass in key North American markets, providing us with a strong market position in Canada and positioning us for further growth in our core U.S. market," Campari Chief Executive Bob Kunze-Concewitz said in a statement.
FCD founder John Hall said: "Introducing customers around the world to my whisky is a dream come true."
The Italian company said its purchase of FCD, the brand portfolio of which comprises vodka, brandy, rum and liqueurs, as well its core Forty Creek Whisky, valued the Canadian company at 14.5 times its forecast 2014 core earnings (EBITDA).
FCD achieved 34.2 million Canadian dollars in sales in its financial year ending March 2013, Campari said, and is expecting revenue to grow 15.6 percent to 39.5 million Canadian dollars this year financial year.
Campari, which reports full-year 2013 earnings on Wednesday, said the deal also includes a distillery, manufacturing facilities and a hospitality center in Canada, where it said FCD's business would remain.
The all-cash deal is expected to close on June 2.
(Reporting by Isla Binnie; Editing by David Goodman)
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