News Alert: Constellation Offloads 30 Wine And Spirits Brands To E.&J. Gallo For $1.7 BillionApril 3, 2019
In a widely expected deal, Constellation Brands has agreed to sell approximately 30 brands from its wine and spirits portfolio to E.&J. Gallo for $1.7 billion, along with related facilities located in California, New York, and Washington. The deal is still subject to regulatory approval and is expected to close in the company’s fiscal first quarter, ending in May.
Constellation had noted that it would be putting its portfolio of labels retailing at $11 and below on the block. Clos du Bois, Black Box, Estancia, Mark West, Wild Horse, Franciscan, and Ravenswood are among the brands included in the deal. The wineries included are Mission Bell, Turner Road Vintners, Clos du Bois, and Wild Horse in California, Hogue Cellars in Washington, and Canandaigua in New York.
“While we continue to invest in our premium and luxury businesses, we see a tremendous opportunity with this acquisition to bring new consumers into the wine category,” said Gallo CEO Joseph Gallo.
“This decision will help enhance organizational focus on a more premium set of wine and spirits brands that better position our company to drive accelerated growth and shareholder value,” said Constellation president and CEO Bill Newlands. “In turn, Gallo is acquiring a collection of great brands that complement their operational model and business strategy to provide quality products to consumers at every price point.”
Moving forward, Constellation plans to focus on premium and above wine and spirits brands including Robert Mondavi, Kim Crawford, Simi, Ruffino, Meiomi, Schrader, Mount Veeder, High West, and Casa Noble, as well as newer entries like Cooper & Thief and Spoken Barrel. The company, which will release its full year results tomorrow, said it will provide further updates on the sale at that time.—Daniel MarstellerSubscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning.