Diageo Plc. Agreed to acquire fast
growing Tequila brand Casamigos, co-founded four years ago by George Clooney,
for as much as $1 Billion. The deal expands the London based distiller’s lineup
in a fast growing category, where it already owns the Don Julio, DeLeon and
Peligroso brands.
The purchase will be Diageo’s
biggest since its $3.2 billion acquisition of United Spirits Ltd in 2014. After
that deal boosted its presence in India, the owner of the Smirnoff brand is
moving to strengthen its US business, which has returned to growth after a
difficult stretch following a slowdown in vodka sales. Meanwhile, tequila
volume in the US more than doubled from 2002 through 2015, according to the
distilled spirits council.
Clooney, better known for his role
in movies such as “Ocean’s Eleven” and as a pitchman for Nespresso coffee,
created Casamigos in 2013 with developer Mike Meldman and entertainment entrepreneur
Rande Gerber. They got in on the tequila boom after tasting together in Cabo
San Lucas, Mexico, where Clooney and Gerber had built vacation homes. Now
they’re cashing out with an initial consideration of $700 million that could be
followed by a further potential $300 million based on a performance-linked earn-out
over 10 years.
Casamigos, packaged in clear
bottles with Clooney’s signature adorning the label, is distilled by an
undisclosed partner in Mexico. Casamigos is sold in three expressions, at $45
to $55: Blanco, which is clear, Reposado, which is golden-coloured, and Anejo, dark
amber variant and the brand oldest. The brand has been marketed with pictures
of the founders enjoying it, captioned with the slogan, “Brought to you by
those who drink it.”
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