Diageo sells 19 brands to Sazerac for $550m

12 November, 2018
Diageo sells 19 brands to Sazerac

Diageo has offloaded 19 brands to Sazerac

Diageo has agreed the sale of 19 brands to Sazerac for an aggregate consideration of $550m, due for completion in early 2019.

The brands included in the transaction are Seagram’s VO, Seagram’s 83, Seagram’s Five Star, Myers’s, Parrot Bay, Romana Sambuca, Popov, Yukon Jack, Goldschlager, Stirrings, The Club, Scoresby, Black Haus, Peligroso, Relska, Grind, Piehole, Booth’s and John Begg.

The net proceeds of approximately £340m, after tax and transaction costs, will be returned to shareholders through a share repurchase following completion, which will be incremental to the previously announced programme of up to £2bn.

Ivan Menezes, chief executive of Diageo, said: “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.”

The transaction is expected to generate a gain on disposal of approximately £110m.

Diageo has also agreed to enter into long-term supply contracts with Sazerac on five of the brands for a period of 10 years.





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