Diageo

[Guest **DONOTDELETE**]

Gentlemen,

Where did Diageo come from? How did it start? What mergers where made and when? What American whiskey distilleries were acquired and when. What were the ultimate outcomes of these acquisitions?

Thank you from the historically challenged,

Linn Spencer

Have Shotglass. Will Travel.

[kitzg]

from www.diageo.com

Diageo is one of the world's leading consumer goods companies. Formed in December 1997 through the merger of GrandMet and Guinness, Diageo has an outstanding portfolio of world-famous food and drinks brands including Smirnoff, Johnnie Walker, J&B, Gordon's, Malibu, Baileys, Guinness and Tanqueray --Across more than 200 countries and many cultures

1749 -- Giacomo Justerini arrives in London from Italy and forms the Johnson and Justerini partnership - predecessor of Justerini and Brooks

1779 Johnson and Justerini start selling Scotch whisky

1831 Alfred Brooks purchases Johnson & Justerini and re-names it Justerini & Brooks

1851 Justerini & Brooks join forces with Twiss Brownings and Hallowes Ltd - agents for Hennessy cognac since 1840 - to form United Wine Traders Ltd

1962 W&A Gilbey merge with United Wine Traders to form International Distillers & Vintners (IDV)

1972 GrandMet acquires IDV

1997 GrandMet and Guinness merge; United Distillers & Vintners (UDV) created from the integration of the IDV and UD businesses

2000 • Diageo plc and Pernod Ricard SA to acquire Seagram spirits and wine business (December)

Mike and Chuck can give you the acquisition trail in the U.S.

Diageo is the parent firm of such other brands as Pillsbury including Old El Paso and Burger King.

[tdelling]

>2000 • Diageo plc and Pernod Ricard SA to acquire Seagram spirits and wine

> business (December)

I have a dumb question.

What does "plc" mean? I always see "Diageo plc" and it's confused me

every time.

Is it some business name abbreviation like "Inc.", "Co.", or "Ltd." ?

Does it mean that they're controlled by the Illuminati? The Masons? Martians?

[cowdery]

PLC: Acronym for public limited company. The designation on a U.K. company's name indicates that shares of the issue may be purchased by the public and traded freely on the open market.

In other words, Masons.

<A target="_blank" HREF=http://cowdery.home.netcom.com>--Chuck Cowdery</A>

[kitzg]

and I thought it was the Martians...

[Guest **DONOTDELETE**]

Thanks for that timeline Greg! Good intel. Any idea as to why Diageo does not mention either George Dickel or I.W. Harper among their brands?

Linn Spencer

Have Shotglass. Will Travel.

[kitzg]

sorry for the delay in answering, Linn.

These bourbon brands are not 'big fish' to a huge firm like Diagio. While they have some interest in niche markets and niche products, they normally focus on the big sellers where the big money is.

To sidetrack that is one reason Sazerac, being a smaller spirits firm, can let Gary and Ken at Buffalo Trace focus on experimentation and mutiple brands while Fortune Brands' Beam puts a lot of money behind white label, then Knob Creek - their best selling small batch.

But we can't be fooled. Most business people have to balance any love of crafted product with the money to be made from marketing to the masses. More people willl buy a Ford Focus (one of the world's best sellers) than a Jaguar (also now owned by Ford). Thus, the total sales of Focus is likely MUCH more than the total sales of Jaguar and there is more profit in the Focus line.

Sorry, I am carrying on....

Greg

kitzg

[ratcheer]

Greg,

That brings me to my biggest complaint about the bourbon business: If the big companies don't really care about the finely crafted whiskeys, then why won't they PLEASE stop buying them up? Let somebody make them that cares about the bourbon instead of maximal profit.

Sorry. I get excited, sometimes.

Tim

[Guest **DONOTDELETE**]

Tim please allow me to butt in at this point. We Southeners tend to attach ourselves to moral causes. In this case it is the loss of bourbon heritage. It is right that we should rant and rave. All we are saying to those that would listen is 'pay attention'!

"Let those who have eyes see. Let those that have ears hear" - Jesus Christ

We Southeners also like to quote Jesus and have GOD on our side because.. well... because it's a Southern thing! [DAMNIT!] Don't try get me confused when I know I'm right. You sound like bleedin' MARY flippin' POPPINS.. " Just spoonful of scotch makes the distilleries go down...the distilleries go down..the distilleries go down".

Here are some hard facts - U.D.V./Diageo bought out Bernhiem; Stitzel-Weller and Glenmore. ALL DEAD!

Who killed 'em? Hmmm? Did they commit suicide? Or were they murdered?!

Just a spoonful of scotch makes the distilleries go down ..the distilleries go down...the distilleries go down

HEY that's the wrong song! Just a spoonful of bourbon makes the scotchies go down..the scotchies go down..the scotchies go down. Just a spoonful of bourbon makes the scotchies go down in the most delightful way!!!

BOURBON - THE BEST TASTING WHISKEY ON THE PLANET!

Lock 'n' Load!

Linn Spencer

Have Shotglass. Will Travel.

[kitzg]

Tim, first I think you may be reading something into my message that is not there. I do not suggest that they don't care at all about the business. They would not buy a company if they did not have interest in it. Yet, they are MORE interested in those brands that give them the greatest return.

If someone has a day job and a night job and their day job pays all of their bills while their night job gives them extra money (for bourbon?), it makes sense that if their day job work starts to suffer because they are working two jobs they may decide to quit the night job or at least cut back on their night hours. The big companies are always making priorities and often the smaller brands suffer.

Which leads to another point. The brands that get sold sometimes would not have been sold if they had been bigger brands and more profitable. Business is business. We all want to get pai d for what we do and firms must look after profit. If some of those distilleries that went up for sale had been able to be more profitable there would have been no reason to sell.

Re big firms worse? Seagrams was a big company. Yet, in the discussions I've had with craftsmen who've worked for Seagrams they felt the top execs. really cared about qualtiy -- so big may not always be bad. (Of course they made more money by selling Four Roses as an export so I suppose some will argue about those decisions for us drinking here.)

Having said that, there are lots of examples of dumb management decisions. Managers are people and make the same kind of dumb mistakes (heard of Enron?) that others do. So sometimes some idiot just simply killed a good business.

Finally, it has been said in this forum by others that we have more quality bourbons with greater variety than was the case 15 - 25 years ago. If that is true, we can't be too harsh on the industry.

Hope this answer isn't too much of 'being carried away.' I'm really not trying to defend anything. Just answer your question.

-- Greg

kitzg

[ratcheer]

Greg,

That was a well thought out answer. And I do understand what you're saying.

I simply regret that small/medium businesses can no longer compete with the huge conglomerates. It causes severe loss of individualism and heritage and unique products.

The same thing is happening to farms and ice cream makers and pharmacies and department stores and ....

I don't know what else to say.

Tim

[Guest **DONOTDELETE**]

Pardon me once again Tim. Greg is a super guy. Very cerebral - he knows his stuff, and he's a lot of fun at a party! No wonder he's a Professor of Marketing at the University of Indiana.

At least Charles Medley has been able to buy back his family's distillery from Diageo. Buddy Thompson was just heart broken over the rape of Glenmore, but they were offered two and a half times what it was worth, and they took it. Greed is a very powerful force.

Where would Stitzel-Weller be today if Julian P. Van Winkel III were running the show? One taste of his bourbon will tell you it wouldn't be the ghost distillery it is now.

The Browns are still in firm control of Brown-Forman Corp. No danger of them falling into Diageo's diabolical hands.

In fact Diageo has probably done as much damage to bourbon as they possibly could already. Only Dickel remains in their dastardly clutches. It may already be a dead distillery. We just can't be sure yet.

Linn Spencer

Have Shotglass. Will Travel.

[jbutler]

Linn,

Here's a subject that's noteworthy; If you take a look at David Sherman's web site <A target="_blank" HREF=http://www.davidsherman.com>http://www.davidsherman.com</A>, it indicates that they own the Wathen's label.

Cheers,

Jim Butler

Straightbourbon.com

[Guest **DONOTDELETE**]

N-N-N-NO Say It Ain't So Joe Demagieo! Joe's wife [Marilyn Monroe] showed her under-alls to an entire lustful nation now Charles Medley has sold out to Bobby Sherman?? No I mean David Sherman! Stop me before I commit a crime! ( I don't have the bail!)

David Sherman has always been listed as the 'bottler' of Wathens. Don't you believe it! Charles and his son Sam along with a small handful of other fine folks bottle up the Wathen's Single Barrel Bourbon as if it were formula for their children.

All this Bobby 'David' Sherman crap is just that - crap!

Linn Spencer

Have Shotglass. Will Travel.

[kitzg]

Don't lose heart, Tim. Remember Sam Walton was a little guy who got laughed at. Wal-Mart is now the world's largest retailer. Bill Gates was once a little guy. In fact a lot of innovation does come from the 'little guy.' And often the little guy becomes the big guy. But it is also true that sometimes the little guy is so successful that he/she (let's not forget some of the little 'guys' are gals) gets bought out. And indeed it is often greed that allows the buyout.

But it is also true that the big corporations can screw up businesses as easily as they can make big brands grow. They also can make it very tough on little guys who won't sell. And that IS a sad part of life. But it has been like that for a lot of years.

And thanks, Linn, for your nice words.

And as Linn points out, since the bourbon industry is still a bit down home (everybody knows everybody) there are a lot of nearly incestuous deals. Like who stores barrels in whose warehouses and who might get barrels from whom.

One more thing. Happy New Year and thanks to all of you who contrbute here for the good of us all. The sharing of information here is great.

-- Greg

kitzg

[ratcheer]

Thanks, Linn. I hope it is apparent that I am not criticizing Greg or what he is saying. I am only lamenting what is going on in the world of bourbon.

I hope Greg hasn't taken any offense from my remarks (and I didn't detect any in his reply). None at all was intended.

Tim

[kitzg]

Tim, rest assured I took no offense nor thought any was intended. You asked a question and I tried to answer it based on my experience and my observations in the spirits industry. I hope the exchange was helpful to us all. And of course, I don't have all of the answers but I have opinions

:-)

Greg

[cowdery]

Sherman's web site indicates that they distribute Wathen's, not that they necessarily own it. In fact, there is no reason to believe they own it. I'm confident the brand is still controlled by the Medley family, so settle down, Linn.

There's nothing wrong with David Sherman. They are a bottler, marketer and rectifier. They are a niche player and God bless them, because they are keeping several venerable brands alive. No one will say on the record, of course, but they probably get their whiskey (aside from Wathen's) from Heaven Hill.

<A target="_blank" HREF=http://cowdery.home.netcom.com>--Chuck Cowdery</A>

[jbutler]

It's fairly hard to argue with Rebel Yell for <$10 for 750ml as well. I've paid twice that for lesser bourbons. That alone gives them the thumbs up in my book

Cheers,

Jim Butler

Straightbourbon.com

[ratcheer]

Great. Thanks, Tim

[cowdery]

Although I haven't tried it, we have also seen good comments in this forum about their Ezra Brooks.

<A target="_blank" HREF=http://cowdery.home.netcom.com>--Chuck Cowdery</A>

[porgymcnasty]

I was dismayed by the following, which involves Diageo

http://classes.seattleu.edu/business_graduate/mktg591/obermiller/barmarketing.htm

also referred to on:

http://www.webtender.com/iforum/message.cgi?id=13304&show=new&sort=date

the webtender forum involves a poster called Angus, who works in the same daigeo department mentioned in the article.

here is an article specifically on Angus:

http://www.city.reuters.com/global/food_drink/drink/505844/?version=1

if anyone has any questions on Diageo, and its weird stratergies, ask Angus!

http://us.geocities.com/sidecar_sid/front_page.html

[kitzg]

I wondered why this dismayed you.

>>"I was dismayed by the following, which involves Diageo"

>> http://classes.seattleu.edu/business_graduate/mktg591/obermiller/barmarketing.htm

>>"The Diageo team is studying how bars can be redesigned and bartenders retrained to encourage more people to splurge on a premium cocktail, containing a Diageo brand. The Jose Cuervo margarita dispenser"

---

Beer companies have been using 'in your face' on-site promotion with neon, tap-handles, free bar stools, free pool table lights, free mirrors, free coasters, free mats,.... for years. I've been in bars since the 1980s that found it easy to have margaritas on-tap (Chi-Chi's chain, for one).

I would not be a bit put off if I walked into a pub and saw a Knob Creek neon, or T-shirt, or Mirror. I DO prefer my whiskey to be poured from a bottle (so I can see I am getting the right pour) but many chains use dispensing units for at least the volume brands.

Thanks for the info, though.

-- Greg

kitzg

[johnrobe]

Ugh! A margarita slurpee machine. Having personally honed my margarita making skills in Texas and knowing the fierce margarita competition between bars there, I bet the slurpee machine never makes it into Texas.

I guess the most we can expect from Diageo is Dickel & RC cola in a 2 liter bottle.

JR

[porgymcnasty]

they do not use slurpee machines, and draught cocktails in quality establishments.

Diageo (and others) seem to copy 'proper' cocktails, then repackage them with inferior ingredients.

Cocktails only taste at their best when made fresh, otherwise they are just alcoholic soda.

George!

actually one new bar I worked had a slushy cocktail machine,

I left. I have got standards!!!

http://us.geocities.com/sidecar_sid/front_page.html