Diageo offloads wine businesses including Blossom Hill to Australia’s Treasury Wine Estates
Diageo has generated substantial revenue from the sale of its UK and US wine businesses to Australia’s Treasury Wine Estates (TWE).
The drinks giant has sold its UK-based Chateau and Estate Wines and US Percy Fox to TWE for $552m (£360.8m). Included in the deal is Blossom Hill, the UK’s favourite wine – according to sales volumes and value.
Ivan Menezes, chief executive of Diageo, said: “Diageo’s strategy is to drive stronger, sustained performance through focus on our core portfolio and today’s announcement is another element of that strategy in action. Wine is no longer core to Diageo and this sale gives us greater focus.
“With the completion of this transaction Diageo will have released £1 billion from the sale of non-core assets since the start of the financial year. This proactive portfolio approach has focused the business, enhanced our financial strength, improved our returns and strengthened the business, positioning us even more firmly to deliver our performance ambition.”
Post-tax, the income from the sale will be used to repay previous loans.
The sale comes months after the company announced its intention to Blossom Hill and Sterling Vineyards back in May.