CL WORLD BRANDS SELLS COGNAC HINE TO EDV SAS. WHAT HAPPENS TO DAVIDOFF & MONNET COGNACS?

2013 is  an important year for Hine:

(1)  Hine celebrates its 250th anniversary,

and (2) Hine was for sale and found a new owner.

It was in the air for the past  3 years as CL World Brands, which operates as a subsidiary of CL Financial, was going through some difficult times.

In 2009, Struggling Caribbean company CL Financial Limited came under the management of the Trinidad and Tobago government following a bail out.

Founded in 1763, Hine specialises in vintage Cognacs, which are released in limited quantities after a minimum ageing.

Hine Cognac, Product Portfolio 

In 1962, Hine was granted a royal warrant from Queen Elizabeth II, as suppliers of Cognac. It is still the only Cognac house to this day. I see Hine as the most British brand of cognac. Although largest brands are pretty much all connected to this part of the world (i.e. including Ireland). That is Hennessey, Martell, Remy Martin, Courvoisier, Hine, Hardy, etc. Why so many Anglo-British brand?

Well, they historically were the largest consumers. And my personal take is they were the best businessmen too! Hence, the designation for cognac VS (very special), VSOP (very superior old pale), and XO (extra old). Originally, the designation were in French: fine cognac (=VS), vieille fine cognac (=VSOP), and Hors d'Age (=XO). But these designations did not mean much in the native languages of the majority of the consumers which explains why English designations became the norm. Some brands still uses the French designations. Comandon Cognac for instance uses both French and English, see below.

Comandon Cognac Very Superior Old Pale, Vieille Fine, VSOP

CL World Brands, which operates as a subsidiary of CL Financial, has completed the sale of Thomas Hine and Company Cognac house to EDV SAS for an undisclosed amount, estimated at 60 million of Euros according to the newspaper Charente Libre.

EDV SAS, a French firm, is managed by the descendants of the family behind wine trader and retailer Établissements Nicolas. So at the end, Hine can celebrate its 250th with a big Cocorricco, since the brand is back to French ownership!

Logo Magasin Nicolas

Commenting on the transaction, EDV SAS was quoted by guardian.co.tt as saying, "Our strategy is to pursue the development and outreach of the Hine brand, in preserving its exclusive positioning on the market and the exceptional quality of its products, as well as in perpetuating the traditional values of its founding family."

Something there is no doubt Bernard Hine is appreciating!

Nicolas is a reputable retailer of fine wine & spirits established in Paris since 1822. Hine will be a good asset to Nicolas and vice and versa.

Earlier this year, CL Financial sold Appleton rum to Campari (Italy) and Burn Stewart Distillers to Distell (South Africa).

Hine Cognac's product portfolio includes Hine Rare VSOP, Hine Antique XO, Hine Jarnac-matured Vintage Cognacs and Hine Early-Landed Vintage Cognacs with an annual turn over of 14 million euros.

However, one has to wonder what will happen to Cognac Davidoff, a licensed brand which Hine just recently acquired from Hennessy, and also Cognac Monnet which were additional brands which Hine owned!

Source: Spirits Drinks Business

Source Photos: www.hinecognac.com

Why do Cognac Houses Have Sub-Brands of Cognac?

In a previous post, I was commenting on how common it is for Cognac Houses to have multiple brands of cognac. In marketing & Brand Management, this is called the multibrands strategy. There are many reasons for this, here are a few:

As the company grows they start being distributed everywhere and they often have exclusive agreement for territories. Along with this, they make new and wider relationships, and they cannot satisfy the opportunities offered through these new distributor relationship in the same areas where they have already agreements. Hence, the need/ opportunity to develop sub-brands.
Also as the business grows they may acquire other houses along the way and this explains the multi-brands.
They may want to cover a wider target market and thus require multiple brands.
It may be a competitiveness plan, such as based on cost leadership. No brands does it all.

This multiple cognac brands situation is not common among the ‘big four’ cognac houses. Or rather not anymore, since Hennessy let go Cognac Davidoff last January 2011 to its competitor Thomas Hine & Co. Davidoff is a brand mostly associated with cigars. Founded by the Davidoff’s family when they moved to Geneva Switzerland in 1911, and brought to an international fame by Zino Davidoff (son).

Cognac Paradis Cognac Davidoff

Davidoff is a brand owned by the The Oettinger Davidoff Group whose business is mostly into cigars and managing licenses of its trade name to specialized producer. The way I look at it it makes more sense that Cognac Davidoff be produced by someone else than Hennessy. Hennessy should not be tied to any other cognac brands and stand alone. They do not need to and they should not. That is not to say that this is also not true for Hine, but it makes more sense that Hine be in charge of this. Hine is a much smaller house of cognac than Hennessy, and it makes more sense that Davidoff be a small special offspring of Hine rather than Hennessy. Hine is such a distinguished cognac House, everything about it is ‘neat’!

www.zinodavidoff.com