US – French-based premium alcoholic manufacturer Moët Hennessy and maker of Italian alcoholic liqueurs Campari Group have partnered to build a European eCommerce platform for wines and spirits.
The 50/50 joint venture will look at investing in wines and spirits eCommerce companies to enable them take advantage of the popularity of consumer shift to online purchases amid the Covid-19 pandemic.
Under the terms of the agreement, Campari will transfer its stake in Tannico – an alcohol eCommerce platform that it acquired last year – into the newly-formed joint venture for €25.6 million.
Tannico owns a majority stake in Ventealapropriete.com, an online wines and spirits retailer in France. Together, the two businesses generated Pro-forma combined sales of over €70 million last year.
“This partnership represents a significant step forward in our global eCommerce development strategy. While eCommerce was already a growing channel for wines and spirits, the global pandemic has triggered a significant acceleration,” said Philippe Schaus, president, and CEO of Moët Hennessy.
The joint venture will be led by current Tannico CEO, Marco Magnocavallo, who will remain a key minority shareholder in the business.
“With the joint backing of Moët Hennessy and Campari, Tannico will have the firepower to consolidate the fragmented European eCommerce sector and offer a qualitative, sizeable, and integrated route to market option catering to the needs of all its wines and spirits suppliers,” Magnocavallo noted.
Consolidating the alcoholic eCommerce market in Europe is a timely effort as the market has become an increasingly important retail channel in the region, according to recent IWSR.
IWSR forecasts that the value of alcohol eCommerce will increase by 42% this year, across 10 core markets, to reach US$24 billion.
These 10 core markets include Australia, Brazil, China, France, Germany, Italy, Japan, Spain, UK, and the US which collectively represent over 90% of total alcohol eCommerce value.
In comparison, alcohol eCommerce value in those markets grew by 11% in 2019, meaning there is great potential for growth and the European market is ready for an effort such as the one being fronted by Moët Hennessy and Campari.
The deal is expected to be finalized after the completion of all customary regulatory requirements.
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