Diageo to drink up deal with Aviation Gin and Davos Brands

Diageo has agreed to buy US-based gin distillery Aviation Gin and Davos Brands for up to USD 610.00 million.

The transaction includes an upfront sum of USD 335.00 million, as well as an earnout of USD 275.00 million, dependent on the performance of Aviation American Gin over a ten-year period.

Diageo will also acquire the other products in Davos Brands’ portfolio, including Astral Tequila, Sombra Mezcal and TYKU Sake.

The deal will be financed using available cash and is expected to complete before the end of 2020, subject to regulatory approvals.

Aviation American Gin produces a range of gins that are infused with a blend of botanicals, including cardamom, juniper and French lavender.

The brand, which is co-owned by Hollywood actor Ryan Reynolds, is distilled in Oregon and is sold across the US, as well as in select stores in Canada, the UK and France.

Its cocktail mixes include the Aviation Cosmo, Aviation Sangria and Ovation.

Aviation American Gin claims to be second-largest brand within the premium gin segment in the US and grew volumes at over 100.00 per cent in 2019, according to the press release.

Following the deal, Reynolds will retain an ongoing ownership stake in the business.

Ivan Menezes, chief executive of Diageo, said: “The acquisition of Aviation American Gin and the Davos Brands portfolio is in line with our strategy to acquire high growth brands with attractive margins that support premiumisation.”

More:  Talkwalker acquires Nielsen Social

Furthermore, the deal will also allow the buyer to drive the gin company’s growth throughout North America.

Headquartered in London, Diageo is one of the world’s largest producers of spirits and beers.

The group houses over 200 brands which are sold in more than 180 countries globally, namely Baileys, Gordon’s and Captain Morgan.

During the six months ended 30th June 2020, Diageo posted sales of GBP 11.75 billion, down 8.7 per cent from GBP 12.87 billion in the corresponding period of 2019.

© Zephus Ltd

More from: | Category: M&A News