Brown-Forman rejected a bid from Sazerac to acquire the Jack Daniel’s owner, saying the latest proposal wasn’t “actionable.”
The offer from Sazerac, which Brown-Forman said Sunday was “unsolicited,” followed reports that the Louisville, Kentucky-based whiskey maker denied an initial $15 billion bid in May. Brown-Forman was separately in talks to be acquired by French alcohol giant Pernod Ricard, but those discussions also fell through.
Sazerac reportedly sent a letter to a group of Brown-Forman shareholders asking the Buffalo Trace owner to reconsider its offer, The Wall Street Journal reported. The formal rejection of Sazerac’s bid could indicate that Brown-Forman isn’t for sale.
Wolf Pen Branch, a group of Brown family members that own a bulk of the company’s Class A shares, said Sazerac’s offer didn’t align with its “vision for Brown-Forman’s future.”
“As fourth-, fifth- and sixth-generation shareholders of Brown-Forman, we care deeply about the company – its brands, its people, and its culture,” the group said in a statement. “We are confident in the strength and competitive position of the business, and believe the company is well-positioned to deliver long-term value for all shareholders.”
Earlier this month, Brown-Forman CEO Lawson Whiting announced his plan to retire from the spirits company once a successor is named. At the time, analysts noted that the Woodford Reserve maker seemed focused on continuity as opposed to larger strategic changes.
Marshall Farrer, Brown-Forman’s chairman, said Sunday that the board and leadership team continue to be confident in the company's long-term growth.
“The company remains focused on executing its strategic plan, including expanding its geographic footprint, building brands that resonate with consumers, and enhancing operational efficiency, while continuing to explore additional opportunities to create sustained value for all shareholders,” Farrer said in a statement.
An acquisition by Sazerac would have continued a dealmaking streak for the Buffalo Trace owner, which recently acquired Dirty Shirley and a stake in Sipmargs.
Brown-Forman, however, would mark a shift in its acquisition priorities, which had mainly focused on ready-to-drink cocktails and brands that appeal to younger consumers, such as BuzzBallz and Kendall Jenner-backed 818 Tequila. While Brown-Forman has worked to expand its RTD portfolio, it remains anchored by traditional spirits, such as Jack Daniel’s and Woodford Reserve.
Brown-Forman reported full-year sales of $3.9 billion, marking a 1% decrease year over year. Net sales of the company’s whiskey products increased 3%, while its tequila portfolio decreased 4%. Net sales of its ready-to-drink portfolio grew 11%.
