BY ZACK O’MALLEY GREENBURG, FORBES STAFF
Earlier this week, media outlets around the world started trumpeting Jay Z’s latest boardroom triumph. “Jay Z buys Armand de Brignac champagne brand,” blared the BBC. “Jay Z likes $300 champagne. So he buys the company,” proclaimed CNN.
Problem is, this piece of ‘news’ isn’t actually new. As I reported in my Jay Z biography, Empire State of Mind, the Brooklyn-born mogul has had a financial interest in Armand de Brignac since its inception—helping boost his net worth to $520 million, by Forbes’ latest estimate—as the $300-per-bottle champagne has become one of hip-hop’s favorite brands.
The story really begins way back in 2006, when Frederic Rouzaud, the manag- er of the company that makes Cristal champagne, put a grape-stomping foot in his mouth when a reporter from the Economist asked his thoughts about the popularity of Cristal among rappers.
“What can we do?” Rouzaud replied. “We can’t forbid people from buying it.”
Many in the hip-hop world took the comments as a major sleight; some sensed racism, including Jay Z. So he called for a boycott of Cristal and stopped rapping about it. Later that year, a mysterious gold bottle appeared in his video for “Show Me What You Got.” The public was soon introduced to the new bubbly, Armand de Brignac, nicknamed Ace of Spades after its bold logo.
Or at least, it was billed as new—sort of. Representatives from Cattier, the French company that makes the champagne, described it as a wine that was “making its North American debut this year, after enjoying success as a premium, high-end brand in France.” Its gold bottle bore a striking resemblance to Antique Gold, a brand discontinued by Cattier in 2006 priced at about $60.
Though Armand de Brignac has since earned its share of praise (frequently from Jay Z in his own songs), some wine critics have given it ratings much lower than Cris- tal and closer to Veuve Clicquot—a fine champagne to be sure, but one planted firmly in the same $60 price range as Antique Gold. New York wine buyer Lyle Fass was less kind, dubbing Armand de Brignac “the biggest rip-off in the history of wine.”
While reporting Empire State of Mind, I decided to travel to France to get to the bottom of the story. I arranged a meeting with the head of Cattier at the company’s beautiful headquarters in the tiny village of Chigny-Les-Roses and headed across the pond.
Upon my arrival, a guide took me on a tour of Cattier’s 150-year-old cellars, which served as part of a network of underground shelters during the sec- ond World War. There, I saw thousands of gold bottles glowing faintly in the damp dark—each waiting to be stamped with an Armand de Brignac spade logo that would differentiate it from Antique Gold.
The company’s commercial direc- tor told me about Cattier’s history and explained that Jay Z had discovered Armand de Brignac in a New York wine shop. He insisted that there was no “fi- nancial involvement,” and that, more or less, Jay Z simply liked the champagne so much that he decided to feature it in one of his videos.
But Armand de Brignac didn’t ship to the United States until the fall of 2006—months after the gold bottle ap- peared in his “Show Me What You Got” video. When I confronted the folks at Cattier about this, they backtracked.
“There’s a misunderstanding regard- ing how Jay saw the bottle,” a company publicist said. “It was in New York … but not in a store.”
Upon my return to the United States, I found the story unraveling even fur- ther. A prominent liquor executive told me Jay Z owned a piece of Armand de Brignac brand, along with Cattier and
a company called Sovereign Brands. A wine distributor and a record executive confirmed this as well; one of my sourc- es pegged the value of Jay Z’s stake at $50 million.
After Empire State of Mind came out in 2011, even Jay Z’s friend, marketing guru Steve Stoute, finally acknowledged that Jay Z had a financial interest in Ar- mand de Brignac in his 2012 book The Tanning of America.
So why are so many outlets now re- porting that Jay Z bought some, or all, of the Armand de Brignac brand this week—and portraying it as a new devel- opment? The burst of publicity can be traced to a press release put out via a Canadian newswire yesterday morning.
“We are proud to announce that Sovereign Brands, a New York-based wine and spirits company owned by the Berish family, has sold its interest in the Armand de Brignac (‘Ace of Spades’) Champagne brand to a new company led by the globally renowned Shawn ‘Jay Z’ Carter,” the statement read.
Neither of the publicists listed in the release returned my emails requesting comment yesterday, and none of the financial details of the agreement have been released. But what happens seems fairly straightforward—Jay Z added to his existing share in the Armand de Bri- gnac brand by buying out Sovereign’s stake.
As one source with knowledge of the situation told me, Jay Z saw a chance to purchase more of something he thought would be worth more in the future than it is today, so he did. He was investing, essentially, in himself.
What remains a question is how
so many outlets, even the New York Times, completely missed the fact that Jay Z already had a financial interest in Armand de Brignac. The answer, it seems, is that they simply gobbled up the press release and didn’t dig any deeper.
In a way, it’s a classic Jay Z outcome. He never commented publicly on my findings—though he did tell me, “That book was horrible!” in my only interac- tion with him—and sure enough, many people continued to believe that he was simply rapping about Armand de Bri- gnac because he liked the taste.
Now, with the cat long out of the bag, he makes the news official, earning praise around the world for his busi- ness acumen—and deservedly so.
“Everybody should take a lesson who wants to sell wine that sucks,” Fass told me. “Because it is probably the most brilliant marketing in the history of wine.” FD
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