NEW FUNDADOR OWNER Emperador Inc. chair Andrew Tan (third from left) visits Bodegas Fundador in Jerez, Spain with son Kevin (second from left) and Emperador president Winston Co after announcing to almost 200 Spanish employees that the Filipino firm is buying Spain’s oldest and largest brandy. CONTRIBUTED PHOTO
LISTED liquor company Emperador Inc. owned by tycoon Andrew L. Tan has acquired Fundador Pedro Domecq, Spain’s largest and oldest brandy, in an “all-cash” deal worth 275 million euros, or P13.8 billion, the Inquirer learned Monday.
The purchase solidifies Emperador’s position as the world’s largest brandy company and makes the Tan-led firm one of the largest foreign investors in Jerez, the brandy capital of Spain.
Under the deal closed on Saturday in Madrid, Grupo Emperador Spain S.A., a company owned by Emperador Inc., will acquire the brandy and sherry business of Beam Suntory in Jerez.
Aside from Fundador Pedro Domecq, the acquisition includes Terry Centenario, Spain’s top-selling brandy; Tres Cepas, Equatorial Guinea’s leading brandy; and Harvey’s, the United Kingdom’s top sherry wine.
These brands carry a unique heritage and market leadership position in their respective categories, Emperador said in a statement furnished the Inquirer.
Fundador, or “founder” in Spanish, was the first brand to be marketed by Pedro Domecq Loustau in 1874. Made from Airen and Palomino grapes, Fundador was the first brand marketed as a Brandy de Jerez and is aged in a sherry-soaked Solera.
Clear leader
Today, it is Spain’s largest export brandy and is sold in more than 30 countries. Fundador’s biggest export market is the Philippines, where it has been the clear leader for more than a century.
Other acquired assets are Bodegas Fundador, Spain’s largest and oldest brandy cellar established in 1730, as well as production facilities, aging cellars, vineyards and state-of-the art blending and bottling facilities in Jerez.
Emperador will likewise take over a brandy distillery in Tomelloso, Spain, which has a sufficient aging inventory of brandy and sherry that Emperador officials believe will drive the company’s growth.
Nomura was tapped as the sole financial advisor while Allen & Overy was hired as the legal adviser for the transaction.
Ceremonial signing
The deal was sealed with the ceremonial signing of barrels at Bodegas Fundador in Jerez.
Tan wrote “A New Era Begins” while Emperador president CEO Winston Co wrote “Sa Totoong Tagumpay” (for real success), which has been the slogan of Emperador for years.
The ceremony was witnessed by Fundador executives and employees late Monday morning in Spain. Tan and Co signed the messages and the historic date of Nov. 30, 2015.
Close to Tan’s heart
Tan said in a statement that the investment was “really close to my heart.”
“I haven’t really slept for weeks thinking about this. And now, I am very happy that I made this important decision of buying this largest and oldest brandy in Spain that has also been a very iconic brand to Filipinos for more than a century,” he added.
Fundador carries significant sentimental value to Tan because 42 years ago, on the evening after he graduated magna cum laude with a Business Administration degree from the University of the East, he first encountered the brand.
Three bottles on graduation
His late father, Tan Ha, had invited his friends and relatives to celebrate the younger Tan’s graduation. They opened and eventually finished three bottles of Fundador. Thus, for Tan, Fundador never fails to bring back memories of a special moment shared with his father.
The investment cements the Philippines’ position as one of the largest investors in Spain, said Carlos Salinas, Philippine ambassador to Spain.
“We are very happy that this particular event has taken place because it makes a mark that the Philippines is looking more and more into Spain for possible investments,” Salinas said in a statement.
“As a matter of fact, the Philippines now is one of the largest investors in Spain and we welcome this, as now we are able to make a mark, we are able to make a strong presence, we are able to be on the radar of the global investment arena,” he said.
The purchase will have an immediate positive impact on Emperador’s bottom line, according to Co.
More than 100 countries
“The acquisition of the Spanish assets and Fundador brandy is immediately accretive both to Emperador’s revenue and net income. With the combined global reach of Whyte and Mackay and Fundador, our expanded product portfolio will have access to more than 100 countries around the world,” Co said.
“[Also] in our pipeline are several proudly Philippine-made products that we intend to introduce to the international markets starting next year,” Co added.
Last year, Emperador acquired Whyte and Mackay Ltd., the world’s fifth largest Scotch whiskey company. Among its brands are The Dalmore and Jura Single Malt Scotch Whiskies, Whyte & Mackay and John Barr Blended Scotch Whiskies and Vladivar Vodka.
As of September, Emperador Inc. has generated 45 percent more revenue, reaching P29 billion. Net income, meanwhile, reached P4.7 billion, up 3 percent from the same period last year, on the back of improving domestic volumes.
It has also expanded its local products with the launch of Smirnoff Mule in May as well as Andy Player Whisky, to add to the best-selling Emperador Light.