Diageo still on hunt for wine asset suitors

Diageo has confirmed its intention to pull out of the wine category at its earliest convenience.

The company has spent the last month offloading its wine assets, starting with the sale of a raft of brands – including Blossom Hill – to Treasury Wine Estates in October. Earlier this month, Diageo exited
Argentina’s wine sector through the divestment of Navarro Correas and San Telmo to Grupo Peñaflor.

The group still holds the Chalone brand and assets as well as the Acacia winery and vineyard, both of which are in the US. Meanwhile, its Mey Icki and United Spirits subsidiaries both hold local wine interests in Turkey and India, respectively.

Speaking to media following Diageo’s Capital Markets Day in the US last week, CEO Ivan Menezes confirmed that – with the exception of the Turkish and Indian wine operations – the company will exit the wine sector. “We’re virtually out,” he said on Wednesday. “There are some local businesses in Turkey and a little bit sitting in India and there are a couple more in California that didn’t fit into the package of what we sold to Treasury.

The wine exit forms part of Diageo’s sale of of non-core assets, which has seen the Gleneagles hotel and golf resort head to Ennismore earlier this year followed by the off-load of two breweries related to a consolidatory purchase in Ghana.

Menezes noted that Diageo will keep hold of the Justerini & Brooks fine wine merchant in the UK, because “that operation is very closely tied to what (whisky brand) J&B is all about”.
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