ompleting a $US16 billion merger to create the world's third-largest spirits maker, Beam Suntory has reiterated its commitment to a 10-year alliance with Coca-Cola Amatil, effectively underpinning the soft-drink bottler's alcoholic beverages strategy.Nicholas Fink, president of Beam's Asia-Pacific and South American business, has ruled out unwinding the manufacturing, sales and distribution deal with CCA, saying Beam needs a strong distribution partner to achieve growth ambitions in Australia.
''We're in a long-term strategic relationship with CCA and a long-term agreement,'' Mr Fink told Fairfax Media in an exclusive interview after Suntory's acquisition of Beam was sealed in Japan last week.
''They're a fantastically powerful platform and have been one of our key partnerships over the years. So, no, it's business as usual for us,'' he said, dousing speculation that the merged group may take advantage of change-of-control provisions in the CCA agreement to break the alliance and combine Beam's local distribution with that of Suntory Australia.
When the Beam acquisition was announced in January, CCA said the change would have no adverse effect on the distribution agreement, which was extended in 2013 until December 2023 and is believed to generate sales of $300 million.
But analysts believe Suntory may yet be prepared to compensate CCA for lost future earnings to take back control of Beam's distribution in Australia.
Suntory already distributes Beam's brands in Japan and Beam distributes Suntory's spirits in south-east Asia.
Mr Fink believes CCA's new managing director, Alison Watkins, remains committed to her predecessor's alcoholic beverages strategy, pointing to an organisational restructure that means the beer and spirits business now reports directly to her.
''They believe it's a growth option for CCA … putting that emphasis on liquor and spirits where we play an enormous role within CCA is a big positive,'' he said.
Mr Fink, who took the helm of Beam's Asia-Pacific business last July from Phil Baldock, says no decisions have been made about Suntory's head office or whether CCA or Beam would take over Suntory's in-house distribution system.
Beam is based in Frenchs Forest in Sydney's north and Suntory in Alexandria in the south.
''We need to be thoughtful and considered about building the strongest platform for our brands in the market … and making sure we preserve some of the capabilities that Suntory has built over time,'' he said.
The group is aiming to lift global spirit sales from about $US6 billion, including excise tax, to $US10 billion by 2020 through organic growth and acquisitions.
