Casa Cuervo Tamps Down Sale SpeculationMay 5, 2011
Speculation over a sale of Jose Cuervo to Diageo has been floated over the past week, based largely on a recent report in London’s Sunday Times. That story, citing unnamed sources, suggested that the Beckmann family were negotiating a deal to sell Cuervo in exchange for Diageo shares.
Casa Cuervo chairman Juan Beckmann Vidal appeared to deny those rumors yesterday, telling Reuters that the current conversations between his company and Diageo are aimed at renegotiating the parties’ distribution contract—not a sale. Beckmann added that Cuervo’s controlling family is close-knit and sees no need to sell the brand. He added that Tequila has plenty of room to grow, particularly in Asia and the BRIC markets.
Despite losing volume in each of the past three years, Jose Cuervo is by far the world’s top-selling Tequila at 6.8 million cases (a global market share of 36%) in 2010, according to Impact Databank. Its current distribution agreement with Diageo runs out in late 2012. Diageo has declined to comment on the sale speculation.Subscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning.