Drinks group Campari could become the first Italian player to enter the French Champagne sector if it successfully concludes talks to buy premium brand Lallier.
The maker of the Campari red aperitif said on Friday it had entered exclusive negotiations with privately-owned French company SARL FICOMA to buy 80% of the Champagne brand founded in 1906 in the town of Ay.
Campari’s shares ended up 2.9% after the announcement, outperforming a 1.7% gain in Milan’s blue-chip index.FTMIB.
Neighbouring France and Italy are friendly rivals in the luxury and lifestyle sectors, which, like the rest of the economy have suffered from lockdowns designed to curb the spread of the novel coronavirus.
French beverage group Pernod Ricard in March announced the acquisition of 50% of small Italian beverage maker Italicus, which some analysts saw as an attempt to challenge Campari’s success in the aperitif category.
Italicus’ sales were 3 million euros ($3.20 million) last year.
Champagne Lallier sold approximately 1 million bottles in 2019, including close to 700,000 of Lallier, Campari said without disclosing financial details of the deal under negotiation.
It said it aimed to buy all of the company in the medium term and to become “the first Italian player in the Champagne category”.
Italy has a particularly strong tradition of socialising over early evening drinks. Some consumption has moved from bars to homes during lockdown as Italians use social media to drink aperitifs in the virtual company of friends or have cocktails delivered to their apartments.
Campari bought French liqueur Grand Marnier in 2016 and began late last year to sell through its own in-market company in France.
If successful, the new deal will allow Campari to build further critical mass in the French market, which accounted for 2.2% of the group’s total sales worth 1.84 billion euros ($2 billion) last year.
The deal’s scope includes the Lallier brand and other Champagne marques owned by the target company, related stocks, real estate assets, including owned and operated vineyards, and production facilities, Campari said.
Source: Reuters.com