Bacardi buys Brugal???

[Porfio_Rubirosa]

As reported in DR1. Hombre I hope not. With the Mexicans buying Productos Sosua, soon the only Dominican-owned business on the North Coast will be the corner colmados.

And what should we expect from Bacardi if its true? I see two scenarios.

One has Bacardi introducing its own brand into the DR while insisting that the Brugal brand is safe. Of course, massive advertising dollars will be spent pushing the Bacardi brand while Brugal is left to die on the vine.

The other has Bacardi spending zillions of dollars to market the Brugal brand internationally - including the requisite increase in price and reduction in quality.

One thing experience tells us about Bacardi: They are a marketing company and NOT a distiller of FINE spirits.

 

[Yan-Yan]

That's not good...

One thing experience tells us about Bacardi: They are a marketing company and NOT a distiller of FINE spirits.

I agree... That would be a shame... I hope at least, they do learn how to make good rum from Brugal!!

 

[Conchman]

Bacardi Anejo distilled in The Bahamas is far superior than any rum Brugal makes.

Their Puerto Rico products are mediocre, I agree, but still dont give you that brutal Brugal hangover!

On the optimistic side, they might use the Brugal facilities to distill Bacardi (or market Brugal under the Bacardi label) eventually resulting in further investments here in the DR, bringing jobs (and probably hurting Puerto Rico).

 

[BigCity27]

does Anheuser-Busch own Bacardi?

I googled Bacardi & a sponsored link came up for an online store for Anheuser-Busch. Anheuser-Busch has Bacardi merchandise in their online store, http://www.budshop.com/budshop/search.aspx?keyword=bacardi&keywordButton.x=9&keywordButton.y=5. On www.anheuser-busch.com they have Bacardi products featured on their opening page.

 

[Porfio_Rubirosa]

Anheisur Bush sells some of those nauseating sweet malt beverages using the Bacardi name under license (like "Smirnoff Ice").

And I've never tasted anything from Bacardi that I would use - except maybe to strip the varnish off of a boat.

 

[Guatiao]

Thats the problems with Dominicans, we dont invest back into our economy then when some other company from another nation buys something of "ours", Dominicans complain. I wonder for how much did they buy it?

 

[Danny W]

I know this is off topic, but you will thank me: If you can find Ron Zacapa Centenario from Guatemala (I get it on 181st. and Cabrini in Manhattan) give yourself a treat. Nothing comes close, it is out of this world!! - D

 

[RandyE]

Uh huh

And like Kolher buying PLaya Grande, they smile and tell you how great it will be for everyone as they are "sticking it" up everyone's AAss!!!

 

[tomgallo]

I know this is off topic, but you will thank me: If you can find Ron Zacapa Centenario from Guatemala (I get it on 181st. and Cabrini in Manhattan) give yourself a treat. Nothing comes close, it is out of this world!! - D

Ron Centenario (as they say 23 years old) is no.1. Flor de Cana from Nicaragua (Black label) and Appletown from JamaICA are good rums.
When Bacardi was a rum made in Cuba, it was the best in the world.

 

[roca]

It seems rumors are true

I'm also divided in my opinion as to what would happen to the Brugal Brand. If the amount of money involved in the rumor is true, upwards of US$400 million, I would suspect Bacardi would want to keep working the brand in the DR as well as internationally. Still, that amount of money is extremely high, considering, in my opinion, Pepsi was more profitable and was sold for 80 and in addition, another rumor has it that E. Leon Jimenez purchased Coca Cola for US$ 60 million plus acquiring their debt. On the other hand, if Bacardi purchased Brugal for a more reasonable amount, say US$ 120 million, my guess is they would be after the international market first and use Brugal's channels of distribution for their Bacardi brand locally. This of course would be a stupid move and waste of money. Here's why: The Brugal brand has no where to go but down because they are already the market leader. The rum market is not likely to increase and to make matters worse word of mouth has it people are starting to say the Brugal is "crudo". So the way I see it, Brugal will be no more in 5 years. For this last reason, it was a very smart move for the Brugal family.
Bacardi has spent millions of pesos trying to work their brand into this market and I'm quite sure the only Bacardi drinkers in the DR are their managers. Their Dewar's brand is not the leader anymore and only God knows what the hell they are doing with Budweiser.
One thing to keep in mind is that Bacardi does not compete with rums internationally, thier Bacardi Silver brand, their strongest selling, competes with vodka and it is the vodka market they are after. To compete against rums they use their 8 anos (although I doubt it's that old).
So, is the rumor true? It probably is. Someone told me, Bacardi appeared at some morning TV show denying the pruchase, why would Bacardi do it and not Brugal ? But then again, what the hell do I know, after all, I heard Bacardi paid US$ 1 billion for Grey Goose Vodka.

 

[TEHAMA]

It could only be an improvement to that "rot gut."

Trago Barcelo!!!

 

[BigCity27]

i don't think Bacardi would eliminate a brand that holds 60% of the market in the Dominican Republic. The advertising for Brugal is already in place all over the North Coast. The name, Brugal, whether you like it or not, is synonymous with rum in the country. Acquisitions like this happen quite frequently, and more often than not, go unnoticed. My hunch is that you'll see a stronger marketing campaign for Brugal domestically & internationally. If they do however replace Brugal with Bacardi, Barcelo is going to have a great oppurtunity to seize the market.

 

[carlos]

are these still rumors or has the acquisition been confirmed?

 

[roca]

Not Yet

The acquisition is not complete yet, my sources tell me they are at due diligence still. Apparently there is a large amount of real estate Bacardi does not want, but the Brugal's want to include it in the package.

Big City: I would imagine your thoughts would be true, but even if Bacardi does not replace Brugal I see the brand decreasing market share in the near future, especially if it is acquired by Bacardi plus the bad word of mouth spreading about the brand. In Santo Domingo one already notices Barcelo Anejo popping all over the place, you couldn't see a Barcelo Anejo bottle months ago. I think a wiser desicion would have been for Bacardi to purchase Barcelo or Bermudez, 2 brands that have the potential to grow, IF in fact that is what Bacardi wants. Still, both of these latter brands are also synonymous with this country. Barcelo was leader from beginning of the 80's until mid 90's, Bermudez was leader during the 60's and 70's. Before the mid 90's no one in their right mind would dare touch a Brugal product. The way I see all this? Smart move for the Brugals dumb move for Bacardi.

 

[BigCity27]

I agree with you Roca, but the OP was right in that Bacardi is a marketing company. Bacardi Rum is not good rum, in my opinion, but if you go to a local club or bar in the States everyone that's drinking rum is drinking either Bacardi or Capt. Morgan (another terrible rum, but good marketer.) Imagine if Brugal would market in the U.S. & elsewhere, the way Bacardi markets, you wouldn't see a decreasing market share. The way I see it is, if Brugal currently has 60% (even if it is declining), some added marketing by Bacardi will increase that percentage.

 

[Porfio_Rubirosa]

I think a wiser desicion would have been for Bacardi to purchase Barcelo or Bermudez, 2 brands that have the potential to grow, IF in fact that is what Bacardi wants.

What Bacardi wants is no competition. Brugal is extremely popular in Spain and has been catching on in other places. If Barcelo or Bermudez start growing too big or popular, Bacardi will buy them too.

 

[BigCity27]

What Bacardi wants is no competition. Brugal is extremely popular in Spain and has been catching on in other places. If Barcelo or Bermudez start growing too big or popular, Bacardi will buy them too.

This just further cements my point that Bacardi will not eliminate the Brugal brand. All they really want is the name & label, so they can market it, they way they think will be better & make more money.

 

[roca]

This of course

is if Barcelo and Bermudez keep standing still not doing any marketing. I think either one just need a little advertising. If they do this, Brugal should start worrying as well as Bacardi.
Big City maybe you are right but dominicans, being that it will no longer be a dominican company, that will have a negative effect on the brand locally. Internationally I would see Brugal increasing market share with all the Bacardi dollars behind the brand.
I guess we'll just have to wait and see what develops.

 

[mankind]

but dominicans, being that it will no longer be a dominican company, that will have a negative effect on the brand locally.

I think that happens in any country when something like this happens. That's why so many of them go unnoticed & very little change ever takes place. If the buy out does take place, I'll bet that Bacardi doesn't even put their name on the Brugal label. If they do it will be in such small font that noone will notice.

 

[Porfio_Rubirosa]

...but dominicans, being that it will no longer be a dominican company, that will have a negative effect on the brand locally.

Really? Presidente is at least half-owned by the US subsidiary of a South African company. I still don't see too many people drinking Quisqueya (desparately in need of reformulation) because of that.

Fact is, almost nobody knows about Presidente's foreign ownership. And, as Mankind noted, almost nobody will know about Brugal either. If desired, a zillion dollar marketing budget will ensure that it's always more Dominican than Juan Pablo Duarte, regardless of who owns it.