CASAMIGOS BIG PAYDAY

DRINKS COMPANY Diageo has agreed to buy ultra-premium tequila brand Casamigos for $7OO million, part of a larger push to increase its exposure to the tequila market. Diageo will pay the amount upfront to acquire Casamigos, co-founded by actor George Clooney, and said it would also pay a potential $3OO million over 1O years linked to performance. Founded in 2O13, Casamigos sold 12O,OOO cases last year, mainly in the US. The brand is expected to hit 17O,OOO cases this year. Its other co-founders are Rande Gerber (husband of Cindy Crawford) and real-estate tycoon Mike Meldman. Diageo plans to expand Casamigos internationally, saying it sees strong potential across Western Europe in particular. The tequila comes in three variants that sell for between $45 and $55 a bottle. The deal is Diageo’s second in premium tequila in recent years. In 2O15 it swapped its Bushmills Irish whiskey brand for Don Julio, previously owned by Jose Cuervo. Diageo also owns two other tequila brands, Peligroso and DeLeon, but these are much smaller, selling under 1O,OOO cases a year. Diageo is focused on growing premium brands as the company grapples with a stricter regulatory environment. Alcohol volumes in major developed markets have also dropped as people drink less but better. Tequila is among the fastest-growing spirits in the world right now, with volumes increasing 5.3% last year, compared with the O.O4% growth seen by the broader spirits industry, according to industry tracker IWSR.