According to Reuters, Bacardi has agreed to buy out Patron Spirits International in a deal valuing the top high-end tequila maker at $5.1 billion. The deal comes soon after Pernod Ricard bought out Avion Tequila and months after Diageo bought George Clooney’s Casamigos tequila for up to $1 billion.
Analysts put the price at about 25.5 times Patron’s estimated operating earnings and 7.5 times its sales. Patron has estimated sales of about $675 million per year. Founded more than 25 years ago, Patron was a high-end pioneer, but now competes with a range of brands including Avion, Diageo’s Don Julio, and Brown-Forman’s Herradura. Bermuda-based Bacardi was founded in Cuba in 1862, selling its namesake rum. It now owns some 200 brands including Bombay Sapphire gin and Grey Goose vodka. It has owned a minority stake in Patron since 2008.
Source: IFT
