Diageo sells 19 brands to focus on ‘premium’ spirits

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New direction: Diageo has sold a number of brands to refocus on premium-and-above spirits

Drinks giant Diageo has agreed the sale of 19 brands to privately owned US firm Sazerac for approximately £428m ($550m).

Brands sold by Diageo

The full list of brands sold to Sazerac is:

  • Black Haus
  • Booth's
  • Goldschlager
  • Grind
  • Jon Begg
  • Myers's
  • Parrot Bay
  • Peligroso
  • Piehole
  • Popov
  • Relska
  • Romana Sambuca
  • Scoresby
  • Seagram's VO, 83 and Five Star
  • Stirrings
  • The Club
  • Yukon Jack

The deal between, Diageo, which owns Guinness and Smirnoff vodka, and Sazerac, one of the US’ oldest family-owned distillers with operations in 10 American states as well as the UK, Ireland, France, India, Australia and Canada, is expected to be completed in early 2019.

The net proceeds, expected to be in the region of £340m, will be returned to shareholders through a share repurchase following the deal’s completion.

Diageo has also agreed to enter into long-term supply contracts with Sazerac for five of the brands, each for a period of 10 years, upon the deal’s completion.

Supply of all other brands will transition to Sazerac within a one year period from completion.

‘Greater focus’

Diageo chief executive Ivan Menezes commented: “Diageo has a clear strategy to deliver consistent efficient growth and value creation for our shareholders.

“This includes a disciplined approach to allocating resources and capital to ensure we maximise returns over time.

“Today’s announcement is another example of this strategy in action.

“The disposal of these brands enables us to have even greater focus on the faster-growing premium-and-above brands in the US spirits portfolio.”