Takeover rumours boost Rémy stock30th May, 2014 by Neal Baker
Rémy Cointreau is enjoying a stock market lift after rumours of a €90-a-share takeover bid by Brown-Forman – the makers of Jack Daniel’s and Southern Comfort – raised the group’s share price by 3% to €67.
Remy’s shares were trading at €96 a year ago, but following a profit warning – a statement to shareholders signalling that predicted profits were not going to be met – the stock price plummeted to a low of €53.
The group, like many other spirits companies, has been badly hurt by a Chinese government crackdown on extravagant spending, with sales of the company’s flagship Cognac falling 32% in the final quarter of last year, following a 30% drop in sales during the third-quarter.
Cognac makes up 80% of Remy’s operating profits, and China was 50% of that total.