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Diageo sells off 19 brands including Seagram’s whiskeys to Sazerac for US$550mln

Published: 08:04 12 Nov 2018 GMT

gin and tonic
Diageo will return the net proceeds from sale, estimated to be around £340mln, to shareholders

Diageo plc (LON:DGE) is selling 19 of its drinks brands, including some of its Seagram’s whiskeys and Parrot Bay rums, for US$550mln (£430mln) to Sazerac, the US-based firm behind Fireball Cinnamon Whisky.

Among the other brands included in the deal are Myers’s, Romana Sambuca, Goldschlager and Booth’s.

READ: Diageo raises estimated impact of exchange headwinds

“The disposal of these brands enables us to have an even greater focus on the faster-growing premium and above brands in the US spirits portfolio,” said chief executive Ivan Menezes.

FTSE 100-listed Diageo will return the £340mln or so of net proceeds to shareholders through a share repurchase following completion, which is expected to be early next year.

It has agreed to enter into long-term supply contracts with Sazerac for five of the brands each for a period of ten years.

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

Shares edged up 0.3% to 2,753p.

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