C&C Group has acquired America’s number two domestic cider brand, Hornsby’s, in a deal worth up to €20m (£17m).
The Magners owner takes over the brand from E&J Gallo for an upfront payment of €16.4m, with an additional €3.6m payable subject to the performance of the business between now and April.
C&C is funding the transaction, which is not subject to legal, tax or regulatory clearances, from existing cash reserves.
The deal will more than double C&C’s volumes in the US, giving it an estimated 20% share of the growing cider market – although cider represents just 0.2% of the long alcohol drinks market.
The company said Hornsby’s complemented Magners’ existing position in the US as the new brand was primarily focused on the off-trade and the West Coast, while Magners targets the on-trade and the East Coast.
“The transaction more than doubles our volume in a growing market and broadens the scope of our cider portfolio,” said designate chief executive Stephen Glancey, who is taking over from the outgoing John Dunsmore.
“It also presents significant opportunity to develop the Hornsby’s brand throughout North America.”
Dunsmore quits C&C after three years in charge (19 October 2011)
Daily Bread: Job Dun (19 October 2011)