Del Maguey acquired by Pernod Ricard

The much anticipated news that Pernod Ricard had acquired a mezcal company finally hit, with perhaps the biggest surprise of all being who it acquired– Del Maguey. Pernod will take a majority stake in the US’ number one mezcal company. The exact terms of the deal were not disclosed. According to the press release and what we have heard from the company, the current management team and staff remain in place and all operations in Mexico remain intact as well.

Pernod is one of the top five spirit companies in the world, along with Diageo, Brown-Forman, Bacardi and Suntory. Given the moves by both Diageo and Bacardi in the mezcal world– Mezcal Union and Ilegal Mezcal respectively, it was rumored that Pernod was looking to pick up a brand for its portfolio.

Now what this means is the bigger question, especially on the heels of our recent piece on the mezcal conundrum. Obviously this is further validation that mezcal is not a trend beverage and large conglomerates are willing to put some money into the industry. This is good news if it means this kind of cash infusion goes into building better infrastructure, better pay for mezcaleros and their employees, and research into more sustainability projects. My glass is half full take.

But, I think this also points to the very gamed system in the international world of spirits and how given the layers required for export/import/distribution/sales staff, it is exceedingly difficult for small, craft brands (which is what the mezcal industry is) to compete. I fear the larger signal this deal sends is that in order for any mezcal brand to “make it” in the market, they have to be part of the larger spirit machine. The pressures that this could bring on production demands, drive for profits, etc could impact the industry negatively, turning it into just another alcohol to be sold, we mezcal obsessives greatest fear. My glass is half empty take.

As to the question of why, Ron Cooper, who is 74 this year, wants the company he built to be in the strongest position possible for the long haul, that the families and communities he has worked with for more than 20 years have long term security, and that product quality remains the focus. He says as much in an email sent this morning: