Quantcast
Get breaking news alerts via email

Click here to manage your alerts
FILE - This Oct. 3, 2012, file photo, shows the Jim Beam visitors center at its central distillery in Clermont, Ky. Beam, the maker of Jim Beam and Marker's Mark alcohol brands, has agreed to be acquired by Japan's Suntory Holdings Ltd. for approximately $13.62 billion. (AP Photo/Bruce Schreiner, File)
Beam being acquired by Japan’s Suntory
First Published Jan 13 2014 03:30 pm • Last Updated Jan 13 2014 03:30 pm

New York » The maker of classic American whiskeys Jim Beam and Maker’s Mark has agreed to be acquired by a Japanese company in a $13.62 billion deal that would create the third largest global premium spirits business.

Shares of Beam Inc. rose 24 percent on Monday after it said that it agreed to be purchased by Suntory Holdings Ltd., a Japanese beverage company. The combined company would have annual sales of more than $4.3 billion.

Photos
Join the Discussion
Post a Comment

The deal follows other recent acquisitions in the alcohol industry, including Anheuser-Busch InBev’s $20.1 billion deal last year to buy the other half of Mexican brewer Grupo Modelo that it didn’t already own.

It also comes at a time when the taste for bourbon — a type of American whisky that is made primarily of corn and typically distilled in Kentucky — continues to grow domestically and abroad.

In the U.S., sales volume for bourbon and Tennessee whiskeys such as Jack Daniels has grown 26 percent over the past decade, according to the Distilled Spirits Council, and industry group. Exports of U.S. whiskeys has grown to roughly $1 billion last year, more than double what it was a decade ago.

Demand is so robust that Beam last year even considered reducing the alcohol content for Maker’s Mark because of a supply shortage. The company scrapped the idea after a backlash by fans of the higher-end bourbon.

"We’re basically in the middle of a global whiskey renaissance," said Frank Coleman, a spokesman for the Distilled Spirits Council.

Suntory and Beam already had a relationship. Suntory distributes Beam products in Japan and has a portfolio of spirits with whiskies, including Yamazaki and Hakushu as well as Midori liqueur and other beverages. And Beam, which is based in Deerfield, Ill., distributes Suntory’s products in Singapore and other Asian markets.

Suntory President and Chairman Nobutada Saji said in a statement that the acquisition will help Suntory further its global growth. In recent years, Suntory has also purchased French beverage maker Orangina Schweppes Group and GlaxoSmith Kline’s Lucozade and Ribena drinks.

Beam spokesman Clarkson Hine said for now, the deal will result in few changes for fans of Beam’s bourbons. He also said that Beam, which was spun off as a stand-alone liquor company in 2011 from conglomerate Fortune Brands Inc., will continue with its current management.


story continues below
story continues below

"It’s business as usual," Hine said, noting that Suntory has indicated it wants the company to "keep doing what we’re doing."

Allen Adamson, managing director of Landor Associates, a New York-based branding firm, said Beam can gain a competitive advantage from being part of bigger company with deeper pockets. He said that ownership by a foreign company shouldn’t hurt the All-American images of Beam’s brands.

"The trick is to maintain its authenticity, and not muck with the core elements," he said.

Suntory will pay $83.50 per share, a 25 percent premium to Beam’s Friday closing price of $66.97. The companies put the deal’s value at about $16 billion, including debt.

Suntory plans to fund the deal with available cash and fully committed financing from The Bank of Tokyo-Mitsubishi UFJ. Both companies’ boards unanimously approved the transaction, which is targeted to close in the second quarter.

The deal needs approval from Beam Inc. stockholders.

Shares of Beam rose $16.14 to $83.11.



Copyright 2014 The Salt Lake Tribune. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Top Reader Comments Read All Comments Post a Comment
Click here to read all comments   Click here to post a comment


About Reader Comments


Reader comments on sltrib.com are the opinions of the writer, not The Salt Lake Tribune. We will delete comments containing obscenities, personal attacks and inappropriate or offensive remarks. Flagrant or repeat violators will be banned. If you see an objectionable comment, please alert us by clicking the arrow on the upper right side of the comment and selecting "Flag comment as inappropriate". If you've recently registered with Disqus or aren't seeing your comments immediately, you may need to verify your email address. To do so, visit disqus.com/account.
See more about comments here.
Staying Connected
Videos
Jobs
Contests and Promotions
  • Search Obituaries
  • Place an Obituary

  • Search Cars
  • Search Homes
  • Search Jobs
  • Search Marketplace
  • Search Legal Notices

  • Other Services
  • Advertise With Us
  • Subscribe to the Newspaper
  • Login to the Electronic Edition
  • Frequently Asked Questions
  • Contact a newsroom staff member
  • Access the Trib Archives
  • Privacy Policy
  • Missing your paper? Need to place your paper on vacation hold? For this and any other subscription related needs, click here or call 801.204.6100.