Stock Spirits buys Distillerie Franciacorta for €25m+

The Stock Spirits Group has announced the purchase of Distillerie Franciacorta Spa, one of the leading Italian producers of grappa, liqueurs and Franciacorta.

Stock Spirits is acquiring the entirety of Distillerie Franciacorta’s spirits and liqueurs business, together with land for the construction of a new production facility. It will also acquire the Franciacorta wine brands, although all aspects of the wine manufacturing will be retained by the vendor.

Founded in 1901, Distillerie Franciacorta is owned by the Gozio family and is located in Franciacorta, in the Lombardy region of Italy.

Stefano Gozio, one of the selling shareholders of Distillerie Franciacorta and a member of the founding Gozio family, will continue to act as a brand ambassador and consultant to Distillerie Franciacorta.

As part of this transaction, Stock Spirits will also take a long-term lease of the Borgo San Vitale site, the distillery and visitor centre.

Stock Spirits chief executive Mirek Stachowicz, said: "This is a truly compelling opportunity that we have been looking at for more than a year now, and we see clear and attractive synergies with our existing Italian operations. 

"Distillerie Franciacorta’s deep expertise in local, premium products resonates strongly with Stock Spirits’ wider strategy of investing in well-loved national brands with genuine and high quality provenance."

The grappa category is Italy’s fourth largest spirits category, and the total premium price segments in which the Franciacorta brands are positioned grew by 5% in value from 2016 to 2017 (IWSR 2018).

The acquisition will mean that Stock Spirits will be the number one branded grappa business by value in the Italian off-trade.

The purchase price is up to €23.5m for the business with a further €3m for the land and the acquisition is expected to be completed in the second quarter of the year.

Stock Spirits anticipates that the acquisition will be earnings neutral in the first complete year of ownership and earnings enhancing thereafter, when it is expected to exceed the cost of capital.

Stachowicz added: “This is our first step in pursuing in-market consolidation opportunities in Italy, and Distillerie Franciacorta will strengthen our position in what is a fragmented but highly attractive market for us.  

"It should also be seen as a clear reflection of our willingness to undertake value-creating M&A as part of our four pillar growth strategy. We welcome Stefano and look forward to working with him in the next phase of the Distillerie Franciacorta story.”