Seagram

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Seagram Company Ltd.
IndustryAlcoholic drinks
FateBroken-up, assets sold
Successor(s)Vivendi, Pernod Ricard, Diageo
Founded1857
Defunct2000
HeadquartersMontreal, Quebec
Key peopleJoseph E. Seagram, Bronfman family
ProductsBeverages
ParentPrivate (1857–1972);
Vivendi Universal (2000)
SubsidiariesPolyGram
Music Corporation of America
 
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Seagram Company Ltd.
IndustryAlcoholic drinks
FateBroken-up, assets sold
Successor(s)Vivendi, Pernod Ricard, Diageo
Founded1857
Defunct2000
HeadquartersMontreal, Quebec
Key peopleJoseph E. Seagram, Bronfman family
ProductsBeverages
ParentPrivate (1857–1972);
Vivendi Universal (2000)
SubsidiariesPolyGram
Music Corporation of America

The Seagram Company Ltd. was a large corporation headquartered in Montreal, Quebec, Canada that was the largest distiller of alcoholic beverages in the world. Toward the end of its independent existence it also controlled various entertainment and other business ventures. The Seagram assets have since been acquired by other companies, notably The Coca-Cola Company, Diageo, Pernod Ricard.

The Seagram Building, the company's American headquarters office tower at 375 Park Avenue in New York City, was designed by architect Ludwig Mies van der Rohe with Philip Johnson. The former Seagram headquarters in Montreal now belongs to McGill University, under the name Martlet House.

Contents

History

In 1857, a distillery was founded in Waterloo, Ontario. Joseph E. Seagram became a partner in 1869 and sole owner in 1883, and the company became known as Joseph E. Seagram & Sons. Many decades later, Samuel Bronfman founded Distillers Corporation Limited, in Montreal, which enjoyed substantial growth in the 1920s, in part due to Prohibition in the United States.

In 1928, a few years after the death of Joseph E. Seagram (1919), the Distillers Corporation acquired Joseph E. Seagram & Sons, and took over the Seagram name. The company was well prepared for the end of Prohibition in 1933 with an ample stock of aged whiskeys ready to sell to the newly opened American market, and it prospered accordingly. Thus despite its earlier Waterloo history, the Seagram name is most closely associated with the Bronfman family. However, it is not correct to say, as is often done, that Samuel Bronfman founded Seagram, since the Seagram name itself pre-dated the company he founded.

Although he was never convicted of criminal activity, Samuel Bronfman's alleged dealings with bootleggers during the (US) Prohibition-era have been researched by various historians and are documented in various peer-vetted chronicles.[1][2]

Original Seagram Distillery buildings in Waterloo, now converted to residential condominiums

After the death of Samuel Bronfman in 1971, Edgar M. Bronfman was named Chairman and Chief Executive Officer (CEO) until June 1994 when his son, Edgar Bronfman, Jr., was appointed CEO.[3]

In 1981, cash rich and wanting to diversify, Seagram Company Ltd. engineered a takeover of Conoco Inc., a major American oil and gas producing company. Although Seagram acquired a 32.2% stake in Conoco, DuPont was brought in as a white knight by the oil company and entered the bidding war. In the end, Seagram lost out in the Conoco bidding war. But in exchange for its stake in Conoco Inc, it became a 24.3% owner of DuPont. By 1995 Seagram was DuPont's largest single shareholder with four seats on the board of directors.

In 1986, the company started a memorable TV commercial campaign advertising its Golden Wine Cooler products. With rising star Bruce Willis as pitchman, Seagram rose from fifth place among distillers to first in just two years.

In 1987, Seagrams engineered a $1.2 billion takeover of important French cognac maker Martell & Cie.

On April 6, 1995, after being approached by Edgar Bronfman, Jr., DuPont announced a deal whereby the company would buy back its shares from the Seagram company for the amount of $9 billion. Seagram's was heavily criticized by the investment community—the 24.3% stake in DuPont accounted for 70% of Seagram's earnings. Standard & Poor's took the unusual step of stating that the sale of the DuPont interest could result in a downgrade of Seagram's more than $4.2 billion of long-term debt.

The rationale for this divestiture was that Edgar Bronfman, Jr., grandson of Samuel Bronfman, wanted Seagram to branch out into the entertainment business. Bronfman, Jr., used the proceeds of the sale to help acquire Universal Studios, MCA, PolyGram, and Deutsche Grammophon. Seagram also gained control of a number of Universal theme parks.

In 1997, the Seagram Museum, formerly the original Seagram distillery in Waterloo, was forced to close due to lack of funds. The building is now the home of the Centre for International Governance Innovation. The two original barrel houses are now the Seagrams Lofts condominiums. There are also almost 5 acres (2.0 ha) of land that will be the home of the future Balsillie School of International Affairs.[4] In 2000, controlling interest in Seagram's entertainment division was acquired by the Vivendi Group, and the beverage division by Pernod Ricard. By the time Vivendi auctioned off Seagram's drink business, beyond its original high-profile brand names the once renowned operation consisted of around two hundred and fifty drinks brands and brand extensions.

In 2002, The Coca-Cola Company acquired the line of Seagram's mixers (ginger ale, tonic water, club soda and seltzer water) from Pernod Ricard and Diageo, as well as signing a long term agreement to use the Seagram's name from Pernod Ricard.[5] Seagram's Ginger Ale was named the winner at the 2009 World Cup of Ginger Ale in Chicago.

On April 19, 2006, Pernod Ricard announced that they would be closing the Seagram Lawrenceburg Distillery located in Lawrenceburg, Indiana. However, the distillery was instead sold in 2007 to CL Financial, a holding company based in Trinidad and Tobago which then collapsed and required government intervention. In October 2011, MGP Ingredients announced that it had reached an agreement (subject to further approval requirements) to purchase the distillery.[6]

Trivia

The "V.O." in Seagram's V.O. whiskey stood for "Seagram's Very Own family blend".

See also

References

  1. ^ Peter C. Newman, Bronfman Dynasty: The Rothschilds of the New World (1978; U.S. title: King of the Castle: The Making of a Dynasty) ISBN 0-7710-6758-5
  2. ^ Daniel Okrent, Last Call: The Rise and Fall of Prohibition pp.146-158 (2010; Simon & Schuster) ISBN 978-0-7432-7702-0
  3. ^ Edgar M. Bronfman, "Good Spirits: The Making of a Businessman" (1998) ISBN-10: 0399143742
  4. ^ Mercer, Greg (January 8, 2009). "New Balsillie School will be 'functional, not fancy', The Record, January 8, 2009". Kitchener Record. http://pqasb.pqarchiver.com/therecord/access/1623151031.html?FMT=ABS&FMTS=ABS:FT&type=current&date=Jan+8,+2009&author=Greg+Mercer&pub=Waterloo+Region+Record&edition=&startpage=B.1&desc=New+Balsillie+school+will+be+'functional,+not+fancy'. Retrieved 2009-08-10. 
  5. ^ "Pernod Ricard and Diageo Sell Seagram's Mixers to The Coca-Cola Company. Business Wire May 7, 2002.". http://www.allbusiness.com/company-activities-management/company-structures-ownership/5880152-1.html. Retrieved 2010-12-29. 
  6. ^ MGP Ingredients Inc. to Purchase Lawrenceburg, Indiana Distillery Assets, company press release, Oct. 21, 2011.