On full throtle

Lawrence Duprey, Chairman of CL Brands, is taking no chances with his rum these days.

The energy titan has made a mint in methanol and ammonia but now wants to tweak the rum formula. “We have been successful in the energy sector with the conversion of gas into methanol and ammonia. We moved on to alcoholic beverages,” said Duprey. “But when we looked at rum and with the global competition coming on we felt that we had to have a global company in order for our rum business to be successful.” The recent acquisition of the world famous cognac house, Thomas Hine, by CL World Brands Brands has the out distillery world on notice.       

Now with the Hine brands of cognac inducted into its portfolio, CL World Brands can brag of having its fingers in the pots of almost every major spirit producer worldwide. CL Brands will control operations for the Angostura Trinidad Group, Burn Stewart, Belvedere and Angostura France. The Hine brands fall under Angostura France. CL World Brands will be operating from Glascow, Scotland as yet another company under the CL Financial umbrella. But rum is just one piece of the puzzle. There are also cruzan, whiskey, vodka and cognac in the mix for CL Brands. According to Duprey, the company’s total acquisitions amount to over US$150 million, with Burn Stewart taking US$53 million and Thomas Hine, about US$ 13 million. “Hine is one of the most prestigious cognac brands. It was a real coup for us to acquire it,” said Duprey. The four Hine brands now under control by CL World Brands were previously owned by Louis Vuitton Moet Hennessy (LMVH). The company was anxious to sell the Hine line because it also owns the famous Hennessy brand of cognac. LMVH felt its sales force was better equipped to deal with one famous brand at a time.

Thomas Hine was formed in 1817 and it remained in the family until 1971 when it was bought by the Distillers Company. However, two of the Hine brothers still have key positions in the company, according to Scottish newspaper reports. In fact, Bernard Hine was appointed honorary chairman of Hine after the acquisition. According to Arnaud de Trabuc, a director of CL Brands and executive director of strategic affairs, this deal is one other companies in the business will envy. Following the consolidation of the CL drinks investments and with the inclusion of the new brands of scotch and cognac, CL World Brands would have a total annual sales of about US $250 million and net sales of about $US 210 million, according to the Burn Stewart website. Duprey said the company currently has an asset base of about US$600 million. With the consolidation of its drinks businesses, the company now has a foothold in every continent with regional expertise in the Caribbean, US, UK, France, Poland, South Africa and South East Asia. With this type of corporate millage, CL World Brands is looking at becoming listed on the London Stock Exchange in the next three years, a goal that has not been achieved by any other local conglomerate. “We are working towards listing the company. But right now it is not appropriate as we are a new company. But we will most likely be listed on one of the overseas exchange. This should happen in about thirty six months,” said Duprey. To achieve this goal, Duprey said the company’s operations will be fashioned along the same lines as the other subsidiaries in the CL group. “What CL Financial does with its subsidiaries, we accumulate savings and invest them in actual resources. As we see it, rum is a derivative of a natural resource: cane,” said Duprey.

He added that in order to be defensive the company had to create a global group that is on par with the global market. Duprey said this strategy should have been adopted to deal with the local sugar industry. “We have created a global structure around one of our natural resources and part of that global structure was a defensive move. We could have done this with sugar if we were bright enough. But we not smart enough, we dumb. We failed to move sugar from a commodity to a product. I have been saying so for twenty-five years,” said Duprey. Fifteen directors of CL World Brands met at the Angostura offices on Tuesday to devise strategies for the company brands. de Trabuc gave insight into the cognac market and specifically the Hine brand. He said the market is split among two premium brands internationally: Hine and Delamain. “Hine is bigger than Delamain in terms of business. Hine is considered to be more than premium, it is at the very top of the spectrum when it comes to quality cognac,” said de Trabuc. He said Angostura holds a Royal warrant from the Queen of England, and now the company has an additional product that also holds a Royal warrant. “We know for a fact that the only cognac in the Palace is Hine,” said de Trabuc. Because Hine is a premium brand, de Trabuc said sales would be small. A bottle of Hine cognac depending on the vintage can cost about US$100. CL World Brands has immediate plans to add other products to its portfolio. The goal is to develop the spirits market, particularly Angostura rums. The Angostura aromatic bitters and the Angostura 1919 eight year-old rum will be the company’s flagship products, according to de Trabuc. In terms of acquiring new spirit brands, Duprey said the company has no plans to buy anymore in the near future. “We have absorbed a lot of companies and we want to concentrate on them for a while,” said Duprey.