Eleven years after partnering with rapper-turned-entrepreneur Jay-Z to launch super-premium cognac D'Ussé, Bacardi International has acquired a majority interest in the brand following a legal dispute that began last year.
Jay-Z sued Bacardi entity Empire Investments Inc. in October because he had been interested in selling part of his 50% stake in D'Ussé via SCLiquor LLC but lacked information about the brand’s sales to determine the value of his stake.
Majority owned by Sean Carter—AKA Jay-Z—SCLiquor accused Empire of mismanagement that was “the result of a scheme to intentionally depress” the value of D'Ussé.
“SC has made repeated demands for D’Usse’s books and records, the most recent of which was served on October 3, 2022,” stated the suit filed on Oct. 20. “D'Ussé has not responded to SC’s information requests.”
Among the allegations in the suit were that Bacardi breached its obligations to D'Ussé by failing to “efficiently allocate its supply of cognac” to meet the demand for it.
“In fact, Bacardi and its affiliates have kept D'Ussé cognac out of stock and allocation, excluded it from Bacardi’s national accounts, declined to expand the brand outside the United States and cancelled a meeting with SC to discuss raising prices for D'Ussé cognac in light of market conditions and input costs.”
According to Bloomberg Law, Jay-Z was seeking $1.5 billion for SCLiquor’s 50% of D'Ussé but Bacardi offered $500 million.
In a news release from D'Ussé last week, Jay-Z and Bacardi announced a “long-term agreement that renews their successful partnership with D'Ussé.”
As part of the deal, Bacardi has acquired “a majority interest in the multibillion-dollar brand from Mr. Carter and he will retain a significant ownership stake in the brand.”