Metcash announced two liquor acquisitions during its FY20 results presentation today.
The wholesaler revealed in April during a $330million capital raising that it was planning three bolt-on hardware and liquor acquisitions.
It has been revealed they are the proposed $57 million acquisition of a 70% controlling stake in Total Tools, plus the purchase of Kollaras & Co's private label brands and the Liquor Centre in New Zealand.
Metcash said the acquisition of the Kollaras Trading's private label portfolio was a key accelerator of the company's private label growth strategy.
Private label has been one of the priority areas for Liquor CEO Chris Baddock, who is the former Director of Pinnacle Drinks.
"The acquisition of the Kollaras Trading Company branded business in Australia and New Zealand includes the ownership of brands such as Two Truths and Seahorse Bay, plus taking on the exclusive supply of imported brands such as Mr Boston Bourbon and Molly’s Irish Cream," Baddock said.
"This acquisition is consistent with ALM’s purpose to champion successful Independents, which includes a strong focus on growing private label; ensuring that ALM has full control over this portfolio, which offers consumers great quality and value as well as growing margin for our retail partners."
Baddock thanked Kollaras and its management team for the partnership in developing these brands over the past five years.
"Both Kollaras and ALM have worked very closely over this period and agreed that it was the right time for ALM to take stewardship of the portfolio. ALM have also completed a supply agreement in order for Kollaras to work with ALM to supply products in to its global business where it will continue to operate as brand owner.
"This is a very exciting acquisition for our retailers and suppliers. I look forward to bringing you further news in the coming months as we build the team around these brands, conduct our category reviews and develop brand plans which motivate both consumers and retailers."
NZ's Liquor Centre commenced business in 1992 with just a couple of stores and has grown to become the largest liquor chain in NZ, with more than 235 stores nationwide.
"It gives me great pleased to announce that The Bottle-O and Merchants Liquor group have reached an agreement to acquire the Liquor Centre banner group, which encompasses the Liquor Centre, Liquor Spot and Satellite brands in New Zealand," Baddock said.
"The combination of these liquor retail marketing groups increases the size of our member network in New Zealand from 110 stores to 350, offering consumers access to a convenient liquor store anywhere they are in the country.
"This acquisition builds on the greater than 2500 store network in Australia and provides a platform for the development of superior retail programs and supplier engagement in New Zealand.
"Our plan in New Zealand is to continue running Liquor Centre Group with its operations Manager, Andrew Senaratne, and its three Regional Managers, utilising all of their experience and expertise. Lal Senaratne, Liquor Centre’s Managing Director, will take a step back, but will no doubt keep a close eye on how the team and group is performing in the future. So, for most people it will be business as usual with the focus on delivering for the Liquor Centre members across the country."
Strong FY20 results in liquor
The company's FY20 results included a 2.9% year-on-year increase in group revenue to $13 billion. After taking charge-through sales into account, revenue totalled $14.9 billion.
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