Tia Maria sold

Published: Wednesday | July 29, 2009

Sabrina Gordon, Business Reporter

Tia Maria

Tia Maria, the famous coffee-liqueur brand that was developed in Jamaica in the 1930s but whose control passed from the island decades ago, has been sold by the French wine producer, Pernod Ricard, raising questions about the future of its manufacture here.

Last night, William McConnell, head of Lascelles deMercado and Company, parent to the company that produces the liqueur, said his company was still in wait-and-see mode.

"With the change in ownership, you would expect change in certain markets," said McConnell.

"As to changes in what now obtains, I don't know because I have not been officially informed of the change in ownership of the brand."

It was reported in Rome Monday that the Italian wine and spirit producer Illva Saronno has paid Pernod 125 million or approximately US$177.7 million for the Tia Maria brand, a move that continued a spate of divestments.

Illva Saronno, owned by the Reina family, is one of Europe's leading wine and spirit companies.

In Jamaica, Tia Maria, whose development the late journalist and writer Morris Cargill played a major role, is manufactured by J Wray and Nephew subsidiary, Estate Industries Limited, and marketed and distributed by J Wray's sister company, Lascelles Wines and Spirits.

The companies are part of the Lascelles deMercado family.

Tia Maria concentrate, McConnell said, is produced under licence by Lascelles shipped to facilities of the principal owner of the brand.

But as part of the deal, Pernod's Chivas Brothers Limited has been appointed to produce Tia Maria for Illva Saronno.

Lascelles Wines' Lisa Bell said earlier on Tuesday that the company expected to renegotiate its contract with the new owners.

Arrangements have also been made by Illva for short-term transitional distribution services to be provided by Pernod Ricardaffiliates while longer-term distribution agreements for certain markets are still to be reached, it was reported in Rome.

Additionally, Pernod Ricard Argentina has also been appointed to produce and distribute the brand in the Argentinian market.

It was not clear where all this leaves manufacturing in and distribution from Jamaica.

Lascelles markets the liqueur in the Caribbean, the United Kingdom and other parts of Europe.

"It's too early to tell what the impact is for Tia Maria here but don't think there will be any significant changes," said Bell, division manager for Lascelles Wines and Spirits.

Bell did concede that that there was likely to be "some change internally with contracts being renegotiated".

Tia Maria is the second-largest coffee-liqueur brand. Pernod owns the market leader, Kahlua.

Family-owned Illva Saronno also owns the Disaronno Originale liqueur brand, along with Artic vodka and wine brands Vini Corvo and Cantine Florio.

In announcing the Tia Maria deal, Pernod said: "The sale of Tia Maria together with other disposals completed since the acquisition of Vin & Sprit in July 2008 enables Pernod Ricard to continue its debt-reduction programme having achieved disposals totalling in excess of 700 million."

Bell would not disclose the volumes of Tia Maria sold from Jamaica.

"We are not at liberty to give that information, but it has been performing consistently," she said.

"Tia Maria is a strong brand."

As part of its spirit portfolio, Lascelles also markets Malibu coconut rum and Kahlua coffee liqueur, two brands also owned by Pernod Ricard whose portfolio includes 15 key brands.