LVMH ESTATE & WINES GROWS WITH ONE MORE, THIS TIME A BURGUNDY ESTATE NAMED DOMAINE DE LAMBRAYS

French luxury group Moët Hennessy Louis Vuitton (LVMH) has made its first move in Burgundy, buying Domaine des Lambrays from Ruth Freund for an undisclosed sum. The domaine includes a near-monopoly of the climat Clos des Lambrays. “It’s the first step in Burgundy, with an exceptional terroir and a great historic estate,” Jean-Guillaume Prats, CEO of LVMH Estates and Wines, told Wine Spectator.

Clos des Lambrays and LVMH

Although the domaine is best known for the 21.5-acre Clos des Lambrays (of which it controls all but 0.1 acre), it owns 27.2 acres in all, including parts of the Morey-St.-Denis premier cru Les Loups, parts of the Puligny Montrachet premier cru Clos du Cailleret and less than an acre of Puligny Montrachet premier cru Clos Les Folatières.
Prats said LVMH would maintain the current distribution and, “of course, the existing, very competent local team will continue to manage the estate.” LVMH already has extensive vineyard holdings, including Châteaus Cheval-Blanc and d’Yquem in Bordeaux, as well as South Africa’s Cape Mentelle, California’s Newton, Cloudy Bay in New Zealand, Cheval des Andes in Argentina, and Spain’s Numanthia, as well as several Champagne houses and sparkling wine Chandon operations in multiple countries.

Source: WineSpectator

SPECULATION OF COGNAC REMY MARTIN BEING ACQUIRED BY BROWN-FORMAN

Rémy Cointreau's shares have fallen by around 40% over the past year because of a slowdown in China's economy. China is an important market for Rémy Cointreau because of the amount of business they do with Rémy Martin in Asia. 

Prior to this slow down, China had accounted for around one-third of Rémy’s turnover. In the first nine months of the company’s fiscal year (ended December 31, 2013), overall sales declined by 12.3% to €964.5 million ($1.325b).

However, today Rémy Cointreau’s share price jumped on rumors that Brown-Forman was considering a bid for the French drinks group.

Brown-Forman and Remy-Cointreau

After financial blog Betaville reported on 3rd April that Brown-Forman has been working with several advisers, including Goldman Sachs, Societe Generale, Lazard Bank etc. on a potential acquisition of Rémy, and that “tentative discussions have been held between investment banking advisers to both companies,” Rémy shares rose by as much as 11% on the Euronext Paris Exchange—to more than €65 ($89)—in this morning’s early trading. By mid-day in Paris, Rémy’s share price surge had cooled, but, at around €62 ($85), they were still nearly 5% above yesterday’s closing.

Rémy Cointreau is a family-controlled company, with the Heriard-Dubreuil family holding majority ownership. Over the years, the Heriard-Dubreuils have steadfastly refused to sell, even as Rémy has at times endured more difficult conditions than it does currently, and I doubt the Heriard-Dubreuil will sell.

Brown-Forman is also a family business with 70% controlled by the Brown family in Kentucky. Jack Daniel's is by far its most famous brand (Tennessee whiskey).

Cognac makes up 80 percent of Remy Cointreau's operating profit and China 50% of it. Jack Daniel's make 50% of Brown-Forman profits.

This would be a major deal in the cognac market. I wonder if this is a 'hoax' as it is being reported by Reuters or Bloomberg also as a 'rumor' and 'speculation'.

Diageo, Pernod Ricard or Bacardi may want to get in the game too.

Sources: http://www.shankennewsdaily.com, http://www.reuters.com, http://www.bloomberg.com