Lucas Bols on Euronext Amsterdam

Amsterdam, the Netherlands - Lucas Bols Holding B.V. (“Lucas Bols” or the “Company”), a 440 year old leading global spirits player, today announces its intention to launch an Initial Public Offering (the “IPO” or the “Offering”) on Euronext Amsterdam. The Offering will primarily comprise the sale of new ordinary shares by the Company and is envisaged to be available to institutional and retail investors in the Netherlands and to certain institutional investors in various other jurisdictions. Gross proceeds of the sale of new ordinary shares by the Company are expected to be around € 125 million and will mainly be used to refinance the Company and further strengthen its financial position. The listing is expected to take place in the near future, subject to market conditions.

 

Company highlights

• Global spirits player with unique heritage dating back to 1575, with more than 20 brands across a range of spirits products, sold globally in more than 110 countries
• Diversified portfolio of premium and super-premium global brands (including Bols Liqueurs and Bols Genever), complemented with strong regional brands (including Pisang Ambon and Bokma)
• Lucas Bols has the number one position in liqueur ranges worldwide (excluding the US) and is the world’s largest player in the genever segment
• Strong focus on innovation and strategic marketing with the aim to lead the developments in the cocktail market
• A leader in the international bartending community with market or category-leading positions in various geographic markets
• Positive underlying market trends providing opportunities for growth in mature as well as developing cocktail markets
• Asset-light business model with large portion of production process (blending and bottling) outsourced to strategic partners
• Attractive financial performance with strong EBIT margin and cash generation, allowing for a target dividend of at least 50% of the Company’s net profits

Huub van Doorne, CEO Lucas Bols:

“We see the intended IPO as a logical next step in the development of our Company. After our buy-out in 2006, we have developed strong market positions in Western Europe and North America and a significant presence in Asia-Pacific and emerging markets. Our innovative marketing approach to optimise the brand portfolio creates valuable brand ambassadors around the world. Our current main shareholder AAC Capital has supported us in our strategy to focus on brand building and innovation. The company is now fully prepared for a standalone future with an enhanced capital markets profile to support our international growth strategy. We look forward to this next step in our development.”

 

Company description and strategy
Lucas Bols is a leading global spirits player with a unique heritage including Bols, the world’s oldest distilled spirits brand, dating back to 1575 in Amsterdam. Building on 440 years of unique history of mastering the art of distilling, mixing and blending, the Company today has more than 20 brands across a range of spirits products, sold globally in more than 110 countries. The portfolio consists of global premium and super-premium spirits brands, such as Bols Liqueurs, Bols Genever, Damrak Gin, Bols Vodka, Galliano and Vaccari, and strong regional brands, of which Pisang Ambon, Bokma, Hartevelt and Coebergh are the largest. Lucas Bols has strong market positions in developed cocktail markets (e.g., the United States and Western Europe) and has a strong presence in Asia-Pacific and the emerging markets, where a vibrant cocktail culture is emerging and where the Company has the opportunity to grow and capitalise on this trend and other positive market trends such as urbanisation and premiumisation.

 

Leading the development of the cocktail market

Lucas Bols’ strategy is to strengthen and grow its global brands in the international cocktail market, while maintaining the competitiveness of the regional brands in certain local markets. Lucas Bols aims to lead the development of the cocktail market by using innovative marketing initiatives including the House of Bols Cocktail & Genever Experience and the Bols Bartending Academy. These initiatives are aimed at creating brand ambassadors around the world and in particular in the bartending community. Furthermore, product innovations with a short time to market further enhance the product offering.

 

 

Asset-light business model
Lucas Bols has an asset-light business model in which a large portion of the production process (blending and bottling) is outsourced to strategic partners. The production joint venture Avandis C.V. (Zoetermeer, the Netherlands), undertakes the blending and bottling process for the majority of the countries in which Lucas Bols sells its products. The Company relies on an extensive distribution network of selected reputable and sizable distributors with global reach for the sale of its products. In the US market the Company distributes its products through its subsidiary, Lucas Bols USA Inc., and in the Netherlands, its products are distributed by its joint venture Maxxium Nederland B.V.

 

Strong cash generation
Lucas Bols benefits from a favourable product mix consisting of a higher margin global brand portfolio and a stable cash generating regional brand portfolio. The attractive gross margins of its premium and super-premium spirits, in combination with its asset-light business model, enable Lucas Bols to achieve a strong cash generation.

 

Management Board
The management board and senior management of Lucas Bols are highly regarded in the global spirits industry and have extensive multinational experience. As a result, Lucas Bols benefits from industry-leading practices in sales and marketing, brand management, distribution, supply-chain management, innovative product development and finance.The management board is composed of Mr. Huub van Doorne (CEO) and Mr. Joost de Vries (CFO).

Huub van Doorne started his career as a marketer and brand builder with Procter & Gamble. In 1989 he joined the Rémy Cointreau group, where he held several positions before becoming executive board director of Rémy Cointreau in 2000, with responsibility for global marketing, sales and distribution. In that same year Rémy Cointreau acquired Lucas Bols. Under Huub van Doorne’s management an innovative rejuvenation strategy for the Bols brand was introduced. In 2006, Huub van Doorne initiated a buy-out, supported by AAC Capital as a result of which Lucas Bols became independent and returned to Amsterdam.

Joost de Vries is trained as an auditor and started his career with KPMG in 1981. In 1996 he became a partner and member of the Management Team International Audit 2000 project at KPMG International in the US. Between 1998 and 2005 he was a management board member of Mid Ocean Group B.V., a pan-European importer and wholesaler of business gifts and premiums. In 2005 De Vries teamed up with Huub van Doorne to prepare the buy-out of Lucas Bols.

Capital structure, financials and dividend
Since the buy-out, the Company’s ordinary shares are owned by private equity firm AAC Capital (currently 75%) and the management board of the Company and certain of its other managers (currently 25%).

In FY 2013/20141 Lucas Bols generated € 78.7 million in revenue, with a gross profit of € 47.6 million. EBIT for FY 2013/14 amounted to € 22.0 million. The gross margin as a percentage of revenue was 60.4%, the EBIT margin stood at 28.0%.
Lucas Bols operates in four geographic markets: Western Europe (representing 46.2% of revenue in FY 2013/14), Asia-Pacific (representing 23.2% of revenue in FY 2013/14), North America (representing 18.1% of revenue in FY 2013/14) and emerging markets (representing 12.5% of revenue in FY 2013/14). Lucas Bols’ portfolio consists of global and regional brands. The global brands are sold in all of its four geographic markets. Regional brands are generally sold in Western Europe and the emerging markets, with a small portion of sales in Asia-Pacific. Over the last years the global brands have shown increasing revenue. In FY 2013/14 global brands represented 69.2% of revenue and regional brands represented 30.8% of revenue.

The current outstanding debt and the preference shares are expected to be refinanced through the primary proceeds from the IPO and new debt facilities, with an intention to achieve an envisaged leverage of 3x EBITDA upon listing. Assuming stable cash flows, the Company has a target average mid-term leverage structure of maximum 2x EBITDA. The Company envisages a target dividend of at least 50% of its net profits realised during the fiscal year.

The Offering
It is contemplated to complete the IPO with listing on Euronext Amsterdam in the near future, subject to market conditions. The Offering will primarily comprise the sale of new ordinary shares by the Company to institutional and retail investors in the Netherlands and to certain institutional investors in various other jurisdictions. The gross proceeds of the sale of new ordinary shares by the Company are expected to be around € 125 million and will mainly be used to refinance the Company and further strengthen its financial position.

The Company has appointed Kempen & Co and Rabobank as Joint Global Coordinators and Joint Bookrunners for the IPO.

 

For further information:
www.lucasbols.com

Citigate First Financial
Floor van Maaren / Uneke Dekkers +31 (0) 20 575 4010 / +31 (0) 6 29 59 7746
lucasbols@citigateff.nl

 

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