Pernod Ricard, formed in 1975 through the merger of two French aniseed liqueur makers, has established itself as the world's number-two distiller through a series of acquisitions. The largest spirits players have expanded and scaled their portfolios over decades, holding up to 250 brands, and we believe there is more consolidation to come. Outside of the top five firms, the industry is highly fragmented, with local players often dominating in niche product categories or local markets. These firms present a new wave of merger opportunities for the industry consolidators, including Pernod, to expand their footprint.