Pernod Ricard has taken a major step in its premiumization strategy by selling its wine division to Australian Wine Holdco Limited (AWL). The sale, which will be completed in 2025, involves iconic Australian, New Zealand and Spanish wine brands. The transaction will enable the Group to concentrate on its premium spirits and champagnes, which will drive future growth.
French wine and spirits group Pernod Ricard has announced a crucial step in its premiumization strategy by signing a sale agreement with Australian Wine Holdco Limited (AWL), a consortium of international institutional investors.
The sale, the financial details of which remain confidential, is expected to be finalized in the first half of 2025.
The transaction involves a significant portfolio of Australian, New Zealand and Spanish wine brands. It includes well-known brands such as Jacob’s Creek, Orlando and St Hugo (Australia), Stoneleigh, Brancott Estate and Church Road (New Zealand), as well as Campo Viejo, Ysios, Tarsus and Azpilicueta (Spain).
This “portfolio of well-established international brands, owned and produced by Pernod Ricard Winemakers”, represents “an annual volume of 10 million 9-litre cases”.
“The whole constitutes a complete integrated platform from vine to bottle, comprising seven wineries”, the group said.
Focus on luxury
The group, which owns such iconic brands as Ricard, Ballantine’s, Absolut and Mumm, sees the sale as an opportunity to strengthen its position in the most profitable segments of the alcoholic beverages market.
“This sale will enable Pernod Ricard to strengthen its premiumization strategy and focus on its portfolio of Premium spirits and champagne brands, the driving force behind its growth,” said the group in a statement.
This decision comes after a period of slow growth for Pernod Ricard. In the third quarter of its fiscal year, sales fell by 2% to 2.35 billion euros, due in particular to the normalization of the post-Covid spirits market.
The key markets of the United States and China performed less well, with organic declines of 11% and 12% respectively, due to inventory adjustments and a “difficult macroeconomic context”.
Strategic objectives
CEO Alexandre Ricard expressed his ambition to maintain growth at the top end of the 4% to 7% range over the medium term.
To achieve this, he continues to focus on targeted acquisitions and strategic divestments. In 2023, the Group acquired Codigo 1530 tequila, Skrewball whisky and alcoholic beverages from Canada’s Ace Beverage Group, while divesting brands such as Czech bitter Becherovka and Clan Campbell blended scotch whisky.
The sale of this wine portfolio, representing around 4% of the Group’s sales, or some 480 million euros, is part of a drive to refocus on higher value-added products. By strengthening its premiumization strategy, Pernod Ricard aims to solidify its future growth and adapt to the changing dynamics of the global spirits market.
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Featured photo : © Pernod Ricard
