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Metro-based MGP Ingredients makes $475M acquisition

MGP Ingredients, Inc. based in Atchison, Kan. announced it has reached a cash-and-stock acquisition agreement for St. Louis-based Luxco Inc. The deal is expected to expand MGP’s product line and increase sales and distribution in all 50 states.

MGP Ingredients Inc. out of Atchison, Kan. reached an agreement to acquire St. Louis-based Luxco Inc. in a cash-and-stock deal valued at $475 million.

Founded in 1941, MGP is considered a leading supplier of premium distilled spirits, contracting recognizable brands and also producing its own brands of high-end spirits.

Fellow beverage company Luxco is similar to MGP with it own distilleries and brands. For the 12-month period ended Oct. 31, Luxco generated net revenue of about $202 million.

“Luxco presents a unique opportunity to take a material step towards realizing our long-term strategy,” MGP CEO David Colo said. “It significantly expands our product line in the higher-value branded-spirits sector and increases our sales and distribution capabilities across all 50 states. We have enormous respect for the platform Luxco has built, and we’re excited to add its portfolio of fast-growing premium distilled spirits brands together with strong, cash-flow generating legacy brands.”

According to the agreement, Luxco shareholders will receive $238 million in cash, subject to adjustments for working capital, net indebtedness and transaction expenses. They also will receive 5 million shares of MGP common stock, currently valued around $238 million.