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Diageo To Acquire Don Papa Rum For Up To $474 Million

January 17, 2023

Diageo has made another bolt-on acquisition, agreeing to purchase Don Papa Rum, a super-premium, dark rum from the Philippines for an initial €260 million ($282m) with a further potential consideration of up to €177.5 million ($192m) through to 2028 subject to performance. The deal is expected to close in the first half of this year.

According to Diageo, the super-premium rum market is in “the early stages of premiumization,” showing a compound annual growth rate of 27% in the U.S. and 18% in Europe between 2016-2021. Don Papa has outpaced that growth in Europe, up 29% in the same time frame, with its strongest markets being France, Germany, and Italy. The brand is also present in the U.S., handled by Zamora Co. USA.

Launched in 2012 by entrepreneur Stephen Carroll, together with Andrew John Garcia, Don Papa is distilled and aged for over seven years in American oak barrels on the island of Negros Occidental in the Philippines. “This acquisition is in line with our strategy to acquire high growth brands with attractive margins that support premiumization, and enables us to participate in the fast growing super-premium plus segment,” said John Kennedy, president of Diageo Europe and India.

Stephen Carroll will remain involved with the brand, working alongside Diageo to build on Don Papa Rum’s growth potential. “Diageo has a strong track record in nurturing founder-led brands,” he said. “They believe in our unique story and have genuinely embraced our brand idea. We believe this acquisition is a great opportunity to take Don Papa into the next exciting chapter of its development.”—Daniel Marsteller

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