E. & J. Gallo Winery Acquires The Alixir Company in California

E. & J. Gallo Winery, a global winery and spirits producer based in California, United States, acquired The Alixir Company, marketed as Bev, based in California, United States, on June 1, 2023. Bev is a beverage brand promoting empowerment and inclusivity. E. & J. Gallo Winery already had exclusive U.S. distribution rights to Bev and had begun to bring the popular brand to consumers across North America.

Transaction Summary

The Facts of the Acquisition

E. & J. Gallo produces and distributes wines and spirits like vodka, brandy, and tequila. In addition to selling its own brands, E. & J. Gallo imports wine from Argentina, Chile, France, Germany, Italy, New Zealand, South Africa, and Spain – and spirits from Australia, the Caribbean, Italy, Mexico, the United Kingdom, and Venezuela.

E. & J. Gallo has always been expanding its range of wines and spirits through the distribution of imported brands. Recently, it expanded its product range to include spritzers (wine mixed with sparkling water with an alcohol content of 5.5%). This was through the exclusive distribution in North America of Barefoot, an Australian brand of ale and spritzers, and Bev, both marketed in cans.

Our Take on the Acquisition

Growth in wine and alcohol consumption is expected to continue at 5.52% annually, far above the GDP growth rate of 1.3% of advanced economies. It is natural for E. & J. Gallo Winery to increase its product range by increasing production, imports, and through acquisitions. 

Acquisition of The Alixir Company and its brand, Bev, makes sense for E. & J. Gallo because since 2021 it has distributed all Bev products in North America. E. & J. Gallo is familiar with the demand for the product, and it has a good, constructive relationship with The Alixir Company’s management, which will be retained to grow the brand.

E. & J. Gallo can also use Bev’s marketing campaign of a constructive drinking culture that inspires equality and embodies inclusive fun. This marketing campaign has been funded primarily by seed funding The Alixir Company secured to the tune of $24 million.

The Transaction

Date:June 1, 2023
Purpose: To grow through acquisition. E. & J. Gallo Winery is the distributor for The Alixir Company.
Acquirer’s Statement:Stephanie Gallo, chief marketing officer of Gallo – “After meeting Alix [CEO, The Alixir Company] two years ago, I could sense the power of the Bev brand, and I respected the innovation and unique approach to reaching consumers. I immediately knew we had to find a way to work together. At Gallo, we are on a mission to serve joy as we win new friends for wine, which means ensuring consumers have access to products that make them feel welcome. As an industry, we are adapting and evolving to remain relevant to the next generation of alcohol beverage consumers. I see the Bev portfolio as a welcome addition to Gallo’s product family that will allow us to continue to offer our consumers beverage options to celebrate any occasion.”

Target/Seller: The Alixir Company

Company Information

Target:The Alixir Company
Industry: Alcoholic Beverages
Employees:81 (Self-published on LinkedIn)
Locations:Venice, California, United States

Product Information 

Products:Bev Blanc – Dry and fizzy with aromatics of crisp green apple, white nectarine, and citrus
Bev Glam Made with red berries, white peach, and passion fruit
Bev Glitz Extra dry and fizzy with notes of elderflower and pear
Bev Glow Extra fizzy with aromatics of melon, tropical fruits, and jasmine flowers
Bev Gris Little fizzy pinot with notes of elderflower, pear, and grapefruit
Bev Noir Edgy, dry and fizzy with aromatics of citrus blossoms, pomegranate, and blackberry
Bev Pride Spitzer made with green apple, white nectarine, and light citrus
Bev Rosé – Crisp, dry with aromatics of fresh strawberry, raspberry, and white peach

Investment Information 

Type:Private, Received eight rounds of venture capital funding (Source: Crunchbase)
Total Funding:USD $24 Million
Investors:Brian McNamara – Angel investor and general partner at Cosmic Venture Partners
Founders Funds – Venture capital firm investing in companies building revolutionary technologies
Formic Ventures – Diversified venture capital firm that invests in early stage, high-potential startups and in biotech
Haus Capital – Angel fund investing in early stage startups
MaC Venture Capital – Seed-stage venture capital firm investing in technology startups leveraging shifts in cultural trends and behaviors
Nia Batts – Angel investor and chief marketing officer and managing director, venture capital at Union Heritage Capital
Pareto Holdings Venture capital firm focused on early stage investment 
Edward Lando – Founder and managing partner at Pareto Holdings – co-investing with Pareto Holding
Republic Capital – Venture capital firm focusing on sustainable projects
True Capital Management – Wealth management firm catering to high-net-worth athletes and entertainers, also making direct investment into private equity

Financial Information 

Revenue:USD $5.3 Million (2022) (Unconfirmed Source: Zoominfo.com)
Revenue per Employee:USD $65,432

Target/Seller Overview: The Alixir Company

Founded by Alix Peabody in Venice, California, Bev is a woman-led beverage brand promoting empowerment and inclusivity in beverages and beyond. Its mission, to “Do it different, do it better. Break the glass,” exemplifies the company’s drive to tackle new frontiers both in the beverage industry and in culture at large. At its heart, Bev is about breaking down barriers and building connections that educate and inspire. This aligns with Gallo’s guiding mission to serve joy in moments that matter.

The first-ever TTB-approved (Alcohol and Tobacco Tax and Trade Bureau) “zero sugar” canned wine on the market, Bev wines are three carbs, 100 calories per serving, 11.9% ABV (alcohol by volume), and are all gluten-free.

Alix Peabody, CEO of Bev’s – “I founded Bev out of a passion for changing not only the drinks in our hands, but the culture surrounding drinking. For us, breaking the glass is about empowering communities and inspiring people to celebrate themselves and own their fun. When I met Stephanie Gallo, it became immediately clear that Gallo’s values and commitment to women and diversity in the industry are exemplary of the exact change we aim to create. We could not be more excited for this partnership and can’t wait to expand the reach of our products and our community.”

Bev’s product range of zero-sugar spritzers (with alcohol by value of 5.5%) and wine

Buyer/Acquirer: E. & J. Gallo Winery

Company Information

Buyer:E. & J. Gallo Winery
Industry: Alcoholic Beverages, Farmland
Employees:7,000 (Self-published on company website)
Locations:Modesto, California, United States

Product Information 

Products:The portfolio on offer includes more than 100 products.
Wine – Alcoholic drink made from fermented grapes
Spritzer – White wine mixed with carbonated water
Sangria – Red wine mixed with fruits or spirits
Tequila – A distilled beverage made from blue agave plant
Whisky – Liquor made from fermented grain mash
Brandy – Liquor produced by distilling wine
Vodka – Clear, distilled spirit made from fermented cereal grains and potatoes
Margarita – Cocktail consisting of tequila, triple sec, and lime juice
RumChata – A cream liqueur made from rum, dairy cream, cinnamon, vanilla, sugar, and other flavorings

Financial Information 

Revenue:USD $5.3 Billion (2022) (Source: Forbes)
Revenue per Employee:USD $757,142

Buyer/Acquirer Overview: E. & J. Gallo Winery

E. & J. Gallo Winery is a family-owned winery with 15 family members actively working in the business. Established in 1933 and headquartered in Modesto, California, E. & J. Gallo Winery remains a privately held and ever-growing company that employs more than 7,000 people worldwide.

The company offers a broad array of products comprising more than 130 brands, including table, sparkling, and luxury wines, beverage products, dessert wines, and distilled spirits like vodka, tequila, and brandy. E. & J. Gallo Winery is an exporter of California wine, with its products available in more than 100 countries. It imports wines from Argentina, Chile, France, Germany, Italy, New Zealand, South Africa, and Spain. Additionally, Gallo imports spirits from Australia, the Caribbean, Italy, Mexico, the United Kingdom, and Venezuela.

It owns 19 wineries strategically located in wine regions throughout California, Washington, and New York and over 23,000 acres of vineyards across California and Washington. In addition, the company contracts with growers who assist with a yearly supply of grapes.

The company has led the way in developing and refining new environmentally friendly practices such as minimizing the use of synthetic chemicals, fertilizers, and pesticides, recycling and reusing processed water, creating new wetlands, and protecting existing riparian habitats.

Recent Acquisitions

  • Denner Vineyards (2022) – A 130-acre vineyard and estate winery in California, United States
  • Agave Loco (2021) – Owner of RumChata, a leading cream liqueur brand established in 2009
  • Pahlmeyer Winery (2019) – A winery based in Napa Valley, California, United States
  • Orin Swift Cellars (2016) – A winery established in 1998 in California, United States
Vineyard at sunset
E. & J. Gallo Winery’s vineyards span 23,000 acres in California, United States
three Gallo wines
Sample wines produced by E. & J. Gallo Winery

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