Santo Domingo.- The quality of Dominican rum and its part of the international markets, especially Spain, have aroused the attention of large European liquor companies in the Dominican market.
First it was Barceló and Compañia acquired by a Spanish company and now Brugal, the leading Dominican brand which its ads assure that "Brugal believes in its people.
The Glasgow, Scotland group Edrington, founded in 1850, acquired most of Brugal’s shares, although the transaction’s amount wasn’t revealed.
Yesterday the company announced it signed a contract with the Scottish company, which produces 85 million bottles of whiskey and is the world’s biggest exporter of malt. The local company said its annual sales are 5 million boxes, with 20 first quality brands.
Brugal said it’ll establish its international sales and marketing office in Spain, its main market outside Dominican Republic.
With the transaction, Edrington will penetrate into one of fastest growing types of liquors globally, together with its already leading brands of Scotch Whiskey.
Brugal said it’ll continue producing rum in Dominican Republic, and that the family, led by George Arzeno Brugal will continue as shareholders. It added that Franklin Báez Brugal was designated president of the company.
From: Canada, Toronto ,Cabbagetown,Parliament and Gerrard
the inevitability of globalization....not necessarily a bad thing....it is get eaten by one of the 3 or 4 big guys or lose sales and distribution and MONEY...most family owned spirits companies worldwide go this route,with very few exceptions....it should be a good deal for everyone including the D.R. more jobs more infrastructure more taxes....Brugal will become a more famous brand...every bottle sold over seas is a travel poster.....where is the downside? there is but......
From: United States
Downside, is when a bigger company takes over a smaller company, they streamline business operations. AKA, cut jobs. Big companies are only known for bringing in other companies, and make more money with less resources. If you don't believe read a couple of financial articles or the wall street journal to see how businesses act when they buy out a smaller company. Chances are, the upper management positions will be moved to Ireland where the parent company is located.
Written by: skysail, 6 Feb 2008 10:16 AM
From: Holy See (Vatican City)
From: Canada, Toronto ,Cabbagetown,Parliament and Gerrard
not so in this instance.....in this case you are basically buying a trademark ie. Brugal rum not real estate and second hand rum barrels......there is very little to liquidate ....thus growth thru sales is the only reason to buy it.....Absolut from nothing and unknown to 15 billion dollar trademark..thats how the liquor business works
From: Canada, Toronto ,Cabbagetown,Parliament and Gerrard
and of course the chairman of the board will be in the home office but the Brugal family will be the important figureheads and executives for this luxury and famous brand ..the Americans did not cry when they made Roberto Goleto the Cuban..... chairman of the board of Coca Cola.....brugal is a public company.....grow up
From: United States
It's fairly clear, in this instance, there won't be much of an adverse effect. The operation is efficient as it is, and it is in an enviable geographic location, close to both a plentiful sugar supply and the huge US market. Not much will change in that regard. To me it sounds like a pretty good deal all the way around.
From: Canada, Toronto ,Cabbagetown,Parliament and Gerrard
proximity to sugar or U.S. market have little to do with the price that was paid.....sales potential market worldwide is the reason,but brugal could not do this on its own ....The world wide consolidation of liqour industry requires distribution and marketing on a much larger scale .....it is a marriage of convenience........and profit
From: Canada, Toronto ,Cabbagetown,Parliament and Gerrard
so davidjule please explain your adverse effect statement
From: United States
I thought I did. But to reiterate, this is a good deal for the DR, and there will be no negative financial fallout from this acquistion, in my opinion.
specifically there will be:
no layoffs, since the operation is already efficient,
no loss of money in circulation, since the export of this product will remain as it is,
and no reduction in the supply of sugar from Dominican farmers,
in fact, the demand for sugar might increase with the new markets now in Europe.
From: United States
to davidjule: i hardly expect any positive effects vis a vis the usa market. they are so protective of bacardi that other rums have a miserable time trying to penetrate that market.
From: United States
That might be true. I'm not sure how open that market is. I do know I contribute a great deal of money to it. In any event, if Brugal has any chance at all, it will take the resources of a larger, more experienced company, such as one making this acquisition. Personally, I'd like to to see them sink Bacardi, and also introduce mamajuana into the US market. Most liquor stores welcome any increased competition since it benefits them to have many distillers vying for shelf position. We'll have to wait and see.
From: United States
actually, Davidjule, i was just discussing the possible introduction of mamajuana into the us last night with some friends. well made iterations of that nectar are wonderful. but on the subject of bacardi; it is probably the worst swill available, but decent rums do not get a fair shake in the us market. they dont want stuff like mount gay and others relegating bacardi to the position it deserves; a fluid for cleaning hub caps!
From: United States
Not even good for that. I agree there is a concerted effort to keep Bacardi deified, but even the mighty fall. Barcardi isn't unassailable, and it would be a mistake to back off simply because of the way things appear. Marketing is often just smoke and mirrors.
From: United States
yes, Davidjule, but bacardi is the american house brand, being from puerto rico. and DR-CAFTA is not going to help, since we are on the verge of seeing retaliatory actions against the dr any time soon. they have decided not to play by the rules, and the usa is not going to sit idly by. a group of americans tried to import furniture into the dr, and quite simply put, could not. i await the follow up.
From: United States
Barcardi may be the house brand now, but things have a tendency to change over time. You'd be surprised how many bars have no house brand at all, per se, when it comes to rum, vodka, and gin. There are just too many brands, and customers have higher expectations. While in Boston recently, I visited my share of bars, and asked every bartender about house brands. They all told me house brands are a thing of the past. I realize this is not a scientific study, but it makes sense. At least it did after the 5th or 6th interview.
From: United States
Davidjule, when i used the term house brand, i meant that it is the american product, and so will receive all the protection possible from the american political directorate; after all, it cannot stand alone on its quality!
From: United States
I guess you see more of a government "guiding hand" than I do. I really don't know how invested the US government is in protecting Bacardi. Overall however, while there might be some influence by Barcardi, I don't see any wide-spread governmental effort to protect any given company, apart key technology producers. The money that controls industry is just too diverse for the government to pick winners and losers. I'm talking about legitimate governmment of course, and I am not ruling out the possibility of individules getting in the way of free enterprise. In other words, it shouldn't happen, but probably does.
From: United States
Beside the political protection Bacardi have, there's something Brugal could not archive ever at the US market (by themselves), inventory & marketing cost, because its not a public co.
Bacardi has lost some markets to his aggresive competitor Captain Morgan in the mid-central-north-south west US, Captain Morgan advertisment campain did the trick.
These British investors can bring some of the tools & cash need it to pump Brugal sales in the US, but I doub it will do much profit due to the diverse rum brands shown in shelves & bars. I have to say, Brugal rum its superior, but the US market its about "Brands".
Does anyone knows how much the DR goverment will collect in taxes for this sale?? Can we ask Mr. Bengoa about it ?
From: Canada, Toronto ,Cabbagetown,Parliament and Gerrard
more fools talking with no knowledge....Bacardi was originally made exclusively in Cuba.....the trademark and registration was moved to Bermuda...before the beard came and stole everything... they got the factories and houses but sorry no trademark to steal...today bacardi is the largest branded spirit in the world that is WORLD it is made in Pueto rico it is also made in Canada it is also made in Spain among other places .....it is #1 by millions of cases it is also the third largest liquor conglamerate in the world owning many other international brands includingDewars ,Martini rossi and the recent purchase of Grey Goose vodka for 2 billion dollars...incidentally castro did confiscate their beer company Hatuey which i believe is also made in miami by the Bacardi familly today.....When the ossified communist stooges fall the Bacardis will be important building blocks in the new Cuba...the sooner the better
From: Canada, Toronto ,Cabbagetown,Parliament and Gerrard
house brand ? how are you using this term? know nothings bacardi produces a brand called Castillo that is very popular as a pouring rum but bacardi is a premium brand whether you like it or not let us not be myopic and think of the booze business as only U.S.A> world wide captian morgan is hardly a footnote....it is the old Serralles rum company of puerto rico
From: Canada, Toronto ,Cabbagetown,Parliament and Gerrard
this guy with the funny haircut is a moron he gets his info from grannma newspaper or something and the other guy how much tax do we get to steal is all he can think about .......there is no free lunch get a job
From: United States
While in Cuba, bacardi rum was mostly tasted by visitors like Hemingway, Capponne and other nostalgic bucanners. After it become public when forced to move to PR, did in fact become a US brand. But in late surveys, many drunks had affirmed seen bats while sleep, beside a well deserved "Hangover".
Most Americans surveyed say ,"they do love their Cuba libre", but they don't miss the bats that bugs them after a long night of Bacardi drinks.
Drink reponsibly, "Captain Morgan"
From: United States
I DON'T LIKE IT. DR has few industries to call it's own and we're selling them off....
From: Canada, Toronto ,Cabbagetown,Parliament and Gerrard
not so Carlos we are moving on to a bigger stage with this particular investment...We now need to polish our coffee image.......our cacao is second to none and who does not like chocolate...best amber for jewelry in the world and unique Larimar and we are begining to produce exotic veggies for export
From: Canada, Toronto ,Cabbagetown,Parliament and Gerrard
every bottle of Brugal rum sold in the world is a travel poster....welcome to the Dominican Republic
From: United States
No more comments !!!
From: Canada, Toronto ,Cabbagetown,Parliament and Gerrard
mr perception you are the guy looking for the tax money from this sale but drinks puerto rican rum....Trying to have it both ways I see....Well you make a very good point...Let us hope our government scrutinizes this transaction to make sure this is just not a cash in and get out by the Brugal family,but I find this highly unlikely....the Brugals have a long history of philanthropy and community service and have made this decision based on many factors, growth and survival being the most important...due diligence by our government and then support is very important....not just collecting confiscative taxes and maybe buying more fighter planes for our generals to buzz around in
From: Canada, Toronto ,Cabbagetown,Parliament and Gerrard
to put things in perspective.....It has been reported that 900 million was the price paid for a large portion of the Brugal co......this is an old an respected company ,that also carries the Dominican image world wide and has a well deserved reputation for quality....Not long ago 2 billion was paid for a product that was cooked up in a New York marketing office and produced in France with high price and snobishness as its only calling cards ...... it was sold for 2 billion after 10 or so years of existence .....The product GREY GOOSE vodka......business genius or marketing scam you be the judge ....The point.....An American concept produced in France does not carry the same baggage as a national symbol like Brugal or the price of Brugal would have Google or Microsoft numbers $$$$$
From: United States
Mr. gouletcolonial;
Perception, sensation interpreted in the light of experience and awareness of the elements of the environment.
I do remember the outcry of Mr. Bengoa, shouting to Verizon Corp. for DR’s taxes and not to say late Shell Co. (DR’s interest bias). I’m pretty sure Brugal Co. stocks holders will disagree with me if you key at least 15% in taxes for their 65% business sale taking in consideration your US$ 900 M. number (I read it was around the US$500,000,000). DR‘s internal revenue office should be collecting about US$135,000,000. By the way, which is a good chunck of cash. But not to say, that the US$ purchase amount will never enter DR’s financial system.
“Sit and Wait” in front of your Central Bank sidewalk, for the money to come. !!!
From: Canada, Toronto ,Cabbagetown,Parliament and Gerrard
if the money ever did end up in the coffers of the government that would be the end of foriegn investment.....Verizon should have been a lesson.....Pigs get fat hogs get slaughtered.....the banco mistako or credito scam should teach those greedy pigs about becoming hogs,everyone knows the government will act with altruism,honesty in this matter just like the D.R.s financial system......let us hope the political hacks remain far away from this ....or we will end up with more fighter planes and departing foriegn investment
Written by: ny4life, 7 Feb 2008 3:00 PM
From: United States, New York, NY
Brugal the best and most powerful rum in the world! It's premium quality. DR has Presidente and Brugal the best if not one of the best beer and rum in the world!!
From: United States
So Mr. Gouletcolonial, Brugal Co, share holders are "Pigs or Hogs" I ask ?
Thanks.
From: Canada, Toronto ,Cabbagetown,Parliament and Gerrard
they are investors and have been and are at risk...this is why hard work and risk are rewarded....waiting for a free government lunch should not....Are you looking for the commision on the fighter plane sale...that is also government free lunch.....Landcruisers and drivers more free lunch...etc etc etc ad nausem ......everything starts with a job,save a little money...etc etc....investment creates jobs,preferably not government jobs
From: Canada, Toronto ,Cabbagetown,Parliament and Gerrard
obviously ny4lifes enthusiasm and pride outstrip his knowledge
Written by: ny4life, 7 Feb 2008 4:29 PM
From: United States, New York, NY
gouletcolonial, Presidente and Brugal are of high quality. Period.
From: Canada, Toronto ,Cabbagetown,Parliament and Gerrard
Brugal and Presidente are of high quality there is no doubt....and presidente because of its very high price is going to be taught a lesson in beer marketing in Latin America....Over the next few years its market share will shrink and those absurd prices will come down....you can bet on it,just like the giants....the public wins with competition.....those who continue to consume it at the higher prices are just putting money in the pockets of people who think they are fools.......this beer costs less in st thomas ,st martin, and in many locations in the U.S.A.....the most expensive part of beer is the glass bottle
Written by: ny4life, 10 Feb 2008 3:41 PM
From: United States, New York, NY
I think the high prices in DR is mostly due to the taxes on alcohol. Since CND has a monopoly on the beer industry Presidente can get away with the high prices. However, AMbev is starting to import more beer foreign beers which should add to the competition a bit in DR. Outside of DR, Presidente has no choice but to place competive prices on its beer to complete with the numerous beers avaliable in other markets such as Europe, USA, Latin America and some Caribbean islands.
From: Canada, Toronto ,Cabbagetown,Parliament and Gerrard
yes taxes and price gouging....but that is all over for them....the new guys are going to teach the jibaritos the beer business in a free market in Latin America....they have been oinking at the trough far to long.....The public will win.....unless they are stupid and want to pay more for their beer
From: United States
gouletcolonial: I am a patriot but nothing tops Colombian coffee, cafe santo domingo, its very watery
Brugal is so good... it's damn near Whiskey.... LOL
My grandfather was buried with a bottle of Brugal...
From: Canada, Toronto ,Cabbagetown,Parliament and Gerrard
good rum of the extra viejo class is better than cognac for sure in my opinion.....these rums are now being recognized by people who drink their spirits strait or with a little water as the equal of any distilled product..whiskey or cognac included.......smoothness and great flavour these rums have in abundance
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specifically there will be:
no layoffs, since the operation is already efficient,
no loss of money in circulation, since the export of this product will remain as it is,
and no reduction in the supply of sugar from Dominican farmers,
in fact, the demand for sugar might increase with the new markets now in Europe.
Bacardi has lost some markets to his aggresive competitor Captain Morgan in the mid-central-north-south west US, Captain Morgan advertisment campain did the trick.
These British investors can bring some of the tools & cash need it to pump Brugal sales in the US, but I doub it will do much profit due to the diverse rum brands shown in shelves & bars. I have to say, Brugal rum its superior, but the US market its about "Brands".
Does anyone knows how much the DR goverment will collect in taxes for this sale?? Can we ask Mr. Bengoa about it ?
Most Americans surveyed say ,"they do love their Cuba libre", but they don't miss the bats that bugs them after a long night of Bacardi drinks.
Drink reponsibly, "Captain Morgan"
Perception, sensation interpreted in the light of experience and awareness of the elements of the environment.
I do remember the outcry of Mr. Bengoa, shouting to Verizon Corp. for DR’s taxes and not to say late Shell Co. (DR’s interest bias). I’m pretty sure Brugal Co. stocks holders will disagree with me if you key at least 15% in taxes for their 65% business sale taking in consideration your US$ 900 M. number (I read it was around the US$500,000,000). DR‘s internal revenue office should be collecting about US$135,000,000. By the way, which is a good chunck of cash. But not to say, that the US$ purchase amount will never enter DR’s financial system.
“Sit and Wait” in front of your Central Bank sidewalk, for the money to come. !!!
Thanks.
Brugal is so good... it's damn near Whiskey.... LOL
My grandfather was buried with a bottle of Brugal...