The Philippines: Ginebra San Miguel Inc. in talks with three foreign hard liquor producers for possible acquisitions

Ginebra San Miguel Inc. is in talks with three foreign hard liquor producers for possible overseas acquisitions or investments, Manila Bulletin reported on May 26.

In an interview, San Miguel Corp. (SMC) president Ramon S. Ang said “there are lots of opportunities to acquire. Most (target acquisitions) are international operations. We are talking to three who are into the hard liquor business.”

“There are brokers handling the acquisition deals for hard liquor,” said Ang pointing out that San Miguel is interested in pursuing every opportunity to expand its businesses given its strong balance sheet.

He explained that there is also an element of luck in acquisitions but, “if you notice we have a lot of acquisitions for the last eight years, we have a success rate of 80 percent. I hope we will be lucky again with these planned acquisitions.”

Meanwhile, Ang said GSMI is poised to regain leadership in the local hard liquor industry. Based on the Nielsen Retail Audit, the company already reclaimed leadership in North Luzon and South Luzon as of March 2016.

Nielsen’s annual Retail Audit also showed that GSMI recorded the fastest growth in market share among the country’s major liquor players in 2015.

The strong performance of both GSMI’s flagship brand Ginebra San Miguel and its other heritage brand Vino Kulafu, which registered 5 percent and 12 percent volume growth, respectively, boosted the company’s share to almost 30 percent last year.

“The company is as resilient as its flagship brand,” said Ang.

GSMI continued its growth momentum into the first quarter with sales volume reaching 5.3 million cases, seven percent better than last year. Revenues equally grew seven percent to P3.9 billion, while operating income doubled to P188 million.

“We are confident that the company will sustain its gains for the rest of the year with relevant marketing initiatives that will resonate across consumer segments,” said GSMI president Bernie Marquez.

26 May, 2016