Constellation USA has agreed to sell its brandy brand Paul Masson to the Sazerac cocktail brand for $255 million and has reiterated its desire to sell its New Zealand wine brand Nobilo to Chateau Garou for $130 million.
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Constellation USA said that the sale of its brandy business, related inventory and certain contractual interests will be completed in the second quarter of 2021 and is subject to approval.
Brandy brand Paul Masson is part of a $1.7 billion deal for U.S.-based Garou Winery, announced in April 2019. Constellation plans to sell 30 of its lower-priced wine brands and related facilities to Chateau Garroux.
However, after being asked to evaluate the sale, Constellation announced in December 2019 that it had revised the deal downward from $1.7 billion to $1.1 billion due to competitive concerns primarily involving the sparkling wine, brandy, liqueur and concentrate categories.
The company removed the brandy brands Paul Masson, Cook " s California Champagne and J. Roget American Champagne from the agreement. These three companies sell about 5 million cases of champagne annually.
In May 2020, Constellation Group again amended its acquisition agreement. The deal is now valued at $1.03 billion, of which $250 million is based on the profit made on the performance of the divested brands over a two-year period.
Last December, Constellation Group announced its decision to sell New Zealand wine brand Nobilo to Chateau Garou. The deal is subject to a modified, larger transaction with Chateau Garou, which still needs to be reviewed by the Federal Trade Commission and approved by the government. Once approved, it is expected to close in the second quarter of 2021.
