Australia a spirit-based ‘RTD island’ in itself: Gruppo Campari


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No wild goose chase...Wild Turkey RTDs have flown off shelves in Australia
No wild goose chase...Wild Turkey RTDs have flown off shelves in Australia
Gruppo Campari tells that Australia is an historical heartland for spirit-based RTDs as it targets Asia Pacific growth by buying its first dedicated production facilities in the country.

The Italian-headquartered firm has agreed to acquire the assets of specialist can and glass contract beverage packer Copack, which currently produces Gruppo Campari’s RTDs, for AUD $20m ($18.21m).

Founded in Melbourne in 2007, Copack has produced Campari’s Wild Turkey RTDs for the native market since 2010, and brand extension American Honey since 2012.

Gruppo Campari expects to complete the acquisition in Q3 2013, and Chiara Bressani, head of group communications, told that the firm now had a sufficient “critical mass”​ in Australia to establish manufacturing facilities in the region to support Asia-Pacific growth.

Spirits gain ground down under

The €1.34bn turnover spirits giant made 6.1% of its sales in Australia in 2012, and Australian Bureau of Statistics data shows wine and spirits cornering an ever greater share of total alcohol consumed, with the latter up from 12% 50 years ago to 20% last year, at the expense of beer.

“We’ve had a platform in Sydney for three years, but still lacked a production facility, so this is definitely an important enabler for the company’s future growth,”​ Bressani said.

Gruppo Campari targets organic and external growth (the latter via M&A) in a roughly 50:50 split, and believes opportunities via this second route exist in a highly fragmented industry driven by local tastes, where the Top 100 premium brands account for only 15% of global spirits volumes.

“This means that we are usually trying to buy brands looking at specific geography where we have critical mass – enough to have a direct platform,” ​Bressani explained said.

“This helps you understand what this acquisition is all about. Our biggest ever acquisition was Wild Turkey in 2008. This helped us not only strengthen ourselves in the US, but also opened up our own platform in Australia for the Asia Pacific.”

Wild Turkey innovation

Copack’s assets included three packaging lines: one for glass bottles, and two can lines, one for variable diameter packages, the other for fixed diameter.

Describing Australia as an historical country for RTDs, they were born there 20 years ago, Bressani noted the 2002- RTD fad in Europe, driven by the likes of Bacardi Breezer and Campari Mixx, while her company also saw success with its SKY Blue RTD in the US.

 “Everyone wanted to buy them, but then so-called ‘alcopops’ fell foul of the law, and were feared to target underage drinkers,”​ Bressani said.

“But Australia has been an island in itself, and the trend continued there, which is why we’ve introduced innovations [in pure spirits] with Wild Turkey and also with Wild Turkey American Honey,” ​she added.

“The latter is really popular in the US, especially on the coasts, and in Australia it’s one of our first brands that enables us have the platform there, and also grow new products such as RTDs, which are popular there,”​ Bressani said.

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