The market for canned cocktails, or ready-to-drinks, has flourished over the past several years.
But even while business was booming, Bronya Shillo saw additional growth opportunities for Fishers Island Lemonade, the canned-cocktail brand she founded during 2014. Recognized as one of the first craft cocktails in a can, Fishers Island Lemonade was inspired by the signature house cocktail served at Bronya’s family-owned business: vodka, whiskey, lemon and honey.
To fully achieve her vision in an increasingly competitive market, Bronya needed a partner with ample resources and experience in the ready-to-drink category.
Bronya found the right home for Fishers Island with E. & J. Gallo, a global wine and spirits company. As an industry leader with a portfolio of ready-to-drinks (in addition to their leading wine portfolio), Gallo had existing sales teams, industry relationships and robust infrastructure to support Fishers Island and supercharge its growth. Bronya sought to sell the brand to Gallo while maintaining involvement in day-to-day operations.
An all-female cross-practice McDermott team, led by Alva Mather, Anne Cox-Johnson and Jen Mikulina, collaborated closely with Bronya to identify and address regulatory, M&A and IP issues, deliver practical solutions and facilitate a smooth transaction.
Beyond closing the deal, they aimed to put Fishers Island and Bronya in a strong position to partner with Gallo into the future.
Within five months, Bronya and her McDermott team closed the deal, and Gallo acquired Fishers Island. During that time, McDermott coordinated finances, resolved a variety of IP, regulatory and other issues for Fishers Island and delivered the information Gallo needed to move forward with the transaction.
Because Bronya will continue as the face of the brand, and Gallo will use her name, likeness and story even if she parts ways with the brand in the future, the IP Group took the lead on creating and updating agreements to protect her long-term interests.
On the M&A side, the team’s work—with guidance from McDermott’s top-ranked in-house alcohol regulatory practice—ensured that Bronya could establish and maintain a positive relationship with Gallo. That solid foundation will help her seamlessly integrate Fishers Island into Gallo’s operations.
Throughout the process, the cross-practice McDermott teams communicated closely and worked in lockstep to ensure that problem-solving in one area of the transaction didn’t impact other areas.
M&A will continue to loom large in the alcohol space. Whether a company is an established player or seeking to enter the industry, alcohol is a commodity that holds consumer loyalty and value despite recessions and the COVID-19 pandemic.
Operating within a highly regulated industry, small or younger alcohol and beverage companies frequently encounter business issues with the potential to derail an acquisition. When it comes to resolving those issues and preparing to close a deal, it is important for M&A teams to understand the nuances around the filing and reporting requirements, beverage formulas and other operational issues that could raise regulatory or buyer red flags.
McDermott’s all-woman team includes a top-ranked alcohol regulatory practice that helped Bronya navigate potential pitfalls and quickly close the deal. Along with delivering skill, experience and a track record of success, the team worked with in-house counsel at Gallo to foster a collaborative deal environment that served Bronya’s best interests.