Just when we thought Missouri couldn't get any more complicated. It has just been announced that Wirtz Beverage and McLane Company (owned by Warren Buffett's Berkshire Hathaway) have formed a joint-venture and entered into an agreement with Missouri Beverage (MoBev). The deal is expected to close in May. Bill Reichhardt will continue to serve as president. Terms of the deal were not disclosed.
The move represents Wirtz' entrance into Missouri and McLane's entrance into the wine and spirits business in the state. Recall McLane made its first foray into the wine and spirits business in 2010 by acquiring Empire Distributors in North Carolina and Georgia. A few months later it expanded into Tennessee by acquiring Horizon Beverage, and then increased its footprint in Tennessee in March 2012 by taking on Delta Wine & Spirits. This move shows that McLane (and therefore Buffett) is still interested in expanding its alcohol beverage footprint across the United States. It also marks its first merger with a major wine and spirits wholesaler - Wirtz Beverage.
Furthermore, while this partnership gives new territory to Wirtz and McLane, it also solves a problem for MoBev, which has been looking to partner with someone bigger for a few years now. In 2009 MoBev began looking at selling options where they had several businesses outside of Missouri interested. However "national interest evaporated," due to the residency requirements, according to MoBev.
"The dynamics of our continually changing industry require bold, dramatic moves if we are going to continue to drive value to our suppliers and customers. Our joint venture with McLane, and together our combined investment into a new state with Missouri Beverage, is a continued step in that direction," said W. Rockwell "Rocky" Wirtz, president of Wirtz Corporation.
We'll have more on what this means for Missouri in tomorrow's issue.
Until tomorrow, Emily
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