Sidney Frank Joins Southern in Pacific Northwest and IL


Dear Client:

Sidney Frank Importing Company made two separate announcements today where it is leaving Wirtz Beverage in Illinois to join Southern Wine & Spirits, effective March 1, and also aligning with Southern in the Pacific Northwest where it was with Young's Market before. SFIC imports Jagermeister, Gekkeikan Sake and Michael Collins Irish Whiskey, and owns organic vodka American Harvest.

Effective March 1, Southern Wine & Spirits of Washington will begin distributing SFIC's spirits brands at the on-premise and its wine brands at the on-premise and off-premise. Beginning June 1, the agreement will carry over to SFIC's spirits brands at the off-premise.

Also effective March 1, Southern Wine & Spirits-Pacific Northwest Brokerage will serve as SFIC's exclusive spirits broker in the control states of Idaho, Montana, Oregon, Utah and Wyoming. Southern will also serve as SFIC's wine broker in Utah and Wyoming, and continue its agreement in Oregon.

Washington's move to privatization prompted the decision. "The shift of Washington to an open state was the impetus for our distributor/broker consolidation in the Pacific Northwest. As we continuously strive to build the strongest and most effective route to market, we made the decision to align our business with Southern Wine & Spirits across these additional five states," said John Frank, vice chairman of SFIC.

When it's all said and done, Southern will serve as the exclusive distributor for SFIC in NY, IL, FL, CA, HI, NM, AZ, NV, KY and WA; the spirits broker in PA, OH, ID, MT, WY, UT and OR; and the exclusive wine broker in UT, OR and WY.

In the past several months, a number of companies have aligned with Southern. Last week Skyy Spirits (now Campari America) renewed its agreement spanning 18 states with Southern and added them in Indiana. In December Ascentia Wine Estates signed new and existing multi-year distribution agreements with Southern across 23 open and control markets. Diageo and Moet-Hennessy signed an agreement spanning all 18 control states and 6 open states earlier this year. In September W.J. Deutsch & Sons also signed a distribution and brokerage agreement with Odom-Southern across the Pacific Northwest in addition to its current agreement in 12 other markets. And White Rock Distilleries (owners of Pinnacle Vodka) appointed Southern in Illinois and New York back in February 2010.


INDIANA POSTPONES SUNDAY SALES. The House Public Policy Committee's chairman told supporters of a bill allowing Sunday sales that it would not be considered this year, according to local reports. Sen. Phil Boots says he will continue to fight for Sunday sales, and is considering introducing legislation that would allow cities and counties to hold their own referendums on the issue - similar to what Georgia did. Indiana and Connecticut are the only two states that ban Sunday sales on all forms of alcohol. Recall that Connecticut Gov Daniel Malloy is pushing legislation that would allow Sunday sales along with several other measures.

WASHINGTON LIQUOR CONTROL BOARD IS MOVING AHEAD as planned with the transition to a private-run liquor system, despite the weak protest bill from Rep. Sam Hunt. In a press release this week the LCB said suppliers representing 99% of all listed spirits products signed the optional supplier buy-back agreement. The agreement allows their products to remain available to customers until the transition to private sales on June 1 and guarantees them the ability to have special orders fulfilled, participation in spirits tasting pilot and allows them to continue to have marketing displays in state stores. "We knew that it would take a partnership with our suppliers to ensure an orderly transition to private liquor sales on June 1, 2012," said director of purchasing and architect of the buy-back agreement Debi Besser. "Our suppliers stepped-up for our customers by agreeing to keep our existing liquor stores fully-stocked through the last day of public sales on May 31, 2012." Wine suppliers who chose to sign the buy-back agreement represent only 22% of all wine products sold in liquor stores. As part of the agreement, remaining spirits, beer or wine inventory will be packaged for shipment and returned to the Distribution Center in Seattle for consolidation in pickup.

BEAM COMPLETES COOLEY DISTILLERY ACQUISITION. Beam Inc has completed the acquisition of Cooley Distillery, which includes the Kilbeggan, Connemara, Tyrconnell and Greenore brands, as well as aging inventory and Cooley's malt and grain distilleries in Dundalk and Kilbeggan, Ireland. The purchase price was approximately $95 million on a debt-free basis. "Beam is excited to enter one of the world's fastest-growing spirits categories," said chief Matt Shattock, noting that its flagship Kilbeggan brand will join the ranks of Beam's Rising Star brands, which are a focus for brand-building investment.

GOV CHRIS CHRISTIE has signed legislation legalizing direct-to-consumer wine shipping in New Jersey. To read more background, click here.

Until tomorrow, Megan

"Do not condemn the judgement of another because it differs from your own. You may both be wrong."

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