Diageo Buys tequila George Clooney for $ $1 billion

The British beverage maker Diageo-owner of brands such as Smirnoff, Guinness and Johnnie Walker-closed agreement to acquire the American brand of tequila Casamigos, founded four years ago by actor George Clooney and his friends Rande Gerber (entertainment industry entrepreneur and husband of Cindy Crawford), and Mike Meldman (real estate entrepreneur). The operation evaluates the Casamigos at $ $1 billion.
Diageo will pay $ $700,000,000 in cash and an additional $ $300,000,000 to be paid based on the performance of Casamigos in the next ten years. The operation will be financed with resources from Diageo and resources box already approved funding for the British company.
The Casamigos was founded in 2013 as a side-project of the actor and his friends. Quickly the luxury brand has received numerous awards from industry experts and drinks fell in taste of American consumers. In 2016, the Casamigos sold 120,000 boxes of tequila, most in the United States. In the last two years, the brand has grown, on average, 54% per year. The expectation for 2017 is 170,000 sales boxes. The brand also features rapid expansion in Europe.
The purchase may favor the expansion of Diageo in the market of luxury tequilas, in which the British already competes with the Mexican brand Don Julio. In the world, the tequila market grew 5.2% in 2016, to $ $7 billion, according to the English consulting International Wine and Spirit Research (IWSR). In the same period, the distillates market shrank 1.3%.
The United States are the largest and most lucrative market for Diageo. The company works to improve performance in the U.S. market. In the first fiscal semester (closed in December), Diageo surged to 7.7 percent in net profits to 1.51 billion pounds ($ $1.9 billion). Net sales grew 14.5 percent to 6.42 billion pounds. In the U.S., revenue increased by 3.6%, driven by the advancement of bourbon, scotch and tequila.
Diageo is not the only one who seeks to strengthen sales of tequila. Earlier this month, the French Pernod Ricard bought Mexican control Del Maguey Single Village Mezcal, which produces tequila and mezcal (agave-based Distilled beverage only once, against two or three destilagens of tequila).
The expectation of Diageo is complete your purchase in the second half. The deal depends on the approval of regulatory authorities. The company informed that it expects the transaction to have a neutral effect on earnings per share in the first three years of activity and report gains in earnings per share from the fourth year. Diageo was advised by Centerview Partners and Sullivan & Cromwell. The Casamigos was advised by the law firm Wilson Elser.