In terms of foreign ownership it would seem Mexico’s tequila industry is all but done and dusted. The American companies Beam-Suntory, Brown-Forman and Bacardi are in the thick of the action with their respective brands Sauza, El Jimador and Cazadores, while the French might Pernod Ricard owns the duo Avion and Olmeca – and that’s just for starters. 

So it’s something of a miracle that Cuervo, owned by the redoubtable Beckmann family, has managed to resist the financial overtures from Diageo – and it’s hats off indeed, as talks seem to have been going on for years. There has, of course, been the odd compromise along the way. The family Beckmann has parted with its remaining 50% of the super-premium contender Don Julio and has acquired the Irish whiskey Bushmills for the princely sum of US$408m. In so doing it agreed to the early termination of the production and agency agreement with Smirnoff in Mexico.

What, I hear you cry, would the world’s leading tequila producer want with an Irish whiskey? And why would Diageo absent itself from the dynamic Irish whiskey fray? It’s much easier to speculate about the latter, but I will say one thing – the Bushmills sell-off clearly indicates that Diageo is not in the brand-building business. Thank heavens some companies are, not to mention Pernod Ricard and its Irish champion Jameson – but more of that later.  

Diageo Stateside has been thrashing around trying to plug the hole left in its portfolio when it lost the distribution rights to Cuervo in the US last year. To this end at the beginning of the year Diageo added DeLéon and Peligroso, both high-end tequilas, to its portfolio. 

For instance, DeLéon’s five variants command prices from US$120 to US$1,000. So with the acquisition of Don Julio the company has now become a leading player in the super-premium tequila ferment that is 100% agave brews, the US$40-plus-plus-plus contenders which are fuelling tequila’s growth, and with superlative profit margins per case are adding very nicely to companies’ coffers. 

Last year the tequila category in the US rose by 3.5% to around 13.4m cases and that tally means, since 2010, sales have grown by a very healthy 2m cases. But the action is heavily skewed not only between the ultra-premiums and the mixtos, which only have to be 51%  agave, but geographically as well. The US accounts for more than 70% of the global tequila export action, and there are just over 100 countries vying for the remaining percentage.

The US is also Irish whiskey’s main stamping ground and, although growing, it is much smaller than the Mexican spirit’s category. Bushmills almost managed 10% growth last year with a case tally of 230,000 in the US. While overseas it grew by 14% to around 800,000 cases, its performance was well behind category leader, the Pernod Ricard-owned Jameson. Its global sales were up by 14% to 4.6m, while in the US depletions were up by 16% to 1.9m cases.