World’s Largest Tequila Maker Plans Bonds for Whiskey Purchase

By Steve Wynne-Jones
World’s Largest Tequila Maker Plans Bonds for Whiskey Purchase

JB y Cia. SA, the family-owned controller of Jose Cuervo tequila, plans to sell bonds for the first time to help pay for the acquisition of whiskey-maker Bushmills.

Bank of America and Citigroup are arranging investor meetings in the US and Europe through 5 May, according to a person familiar with the matter, who asked not to be identified because the information is private. Fitch Ratings graded the proposed $500 million 10-year bonds BBB, two levels above junk, citing the company’s low leverage and strong brand.

The 250-year-old Mexican distiller agreed in February to buy Bushmills from Guinness-maker Diageo Plc for $408 million and full ownership of the Don Julio tequila brand. After the transaction, tequila will account for 68 per cent of the JB y Cia.’s sales, down from 72 per cent, Fitch said in a statement.

Bushmills is even older than Jose Cuervo. The company, based in a town of the same name in County Antrim, Northern Ireland, was first awarded a distilling license in 1608, yet it struggles to compete with Pernod Ricard SA’s Jameson. Jameson outsells Bushmills and its flagship Black Bush brand more than 5-to-1 in the U.S.

The bond would be the group’s only debt and would push its net leverage ratio to 0.9 times, Fitch said.


Jose Antonio de Cuervo obtained land from the King of Spain in 1758, and the first Vino Mezcal de Tequila de Jose Cuervo was made in 1795, according to the brand’s website. All Jose Cuervo is made in the town of Tequila, in the Mexican state of Jalisco. The spirit is made from the blue agave plant and has to be produced in a designated area to be labeled Tequila, the website says.

Bloomberg News, edited by ESM