Cheers! Diddy & Diageo Buy DeLeon Tequila
We were just commenting on the stellar year that Diddy had in 2013 and now it looks like he wants to continue the trend in 2014. He and Diageo have jointly purchased American tequila brand DeLeon, building on the spirits business that started with the blockbuster vodka brand Ciroc.
“With Ciroc, we dated. Now with DeLeon, we’re married,” Sean Combs told Reuters.
For Diageo, the deal is a step towards replacing the tequila business lost when the company let its distribution deal with Jose Cuervo expire. Financial details haven’t been disclosed. But according to Bloomberg, each side will own half of the company. And DeLeon is sold in 18 states and Washington DC.
Diageo says it would like to make up for those lost Cuervo profits within two years. Eighty-five percent of all tequila is consumed in Mexico and the US. And Diddy says his favorite DeLeon tequila is an anejo that sells for $200 a bottle. A bottle of DeLeon can cost as much as $1,000. Moreover, Diageo North America President Larry Schwartz told Reuters that they could purchase another tequila brand. In a statement, the company also noted that tequila with a price point above $40 is the “second-fastest sector of the US tequila market.” CNBC also provides some info on the tequila market in the US, if you’d like a few more numbers.
Diddy and Diageo certainly have a winning track record. The Ciroc marketing and profit-sharing deal between the two was launched in 2007 and since then, sales of the brand have risen 40-fold.
“This deal is way better,” Diddy also told Reuters. “This makes me a true owner.”