The company that create the popular cider in the UK, Magners, are going to be purchasing the largest domestic cider manufacturer in the United States for a reported £190 million. In recent years, the UK company have seen a decline in their business, and for this reason they have decided to purchase the company abroad in order to boost their sales.
The US company is Vermont Hard Cider and they are perhaps best known for producing the cider Woodchuck. It is expected that the deal is going to be finalised in February 2013, although there was much speculation that the deal would and go through because the price for the company was regarded as too high. These analysts have been proved wrong however, as the deal has recently been completed.
Magners is an Irish company, and they have been looking to diversify their portfolio in recent years, and move into to markets that are fast growing. They have identified that there is a certain amount of volatility in domestic trade in Ireland as well as the rest of the UK, and they saw a particular slump in sales of the drink this particularly poor summer.
Revenues for the group fell about two percent until August this year, leaving them with £214 million in revenue. Operating profit was around £50 million. This is around three percent lower than the same figures for 2011, and it is largely thought that this might have prompted the company to make a move on a United States acquisition.
The Chief Executive of the group is Kenny Neison and he has commented, “Unfortunately the summer just didn’t see the sales that we wanted. This is largely because the weather was terrible, and people weren’t having as many parties and barbecues were cider would be perfect.”