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Posted 9th April 2019

Constellation Brands Repositions Portfolio with its Wine & Spirits Sale Transaction

Constellation Brands, Inc., a leading beverage alcohol company, announced that it has signed an agreement with E. & J. Gallo to divest approximately 30 brands from its wine and spirits portfolio to capitalize on consumer trends. Stansfeld Scott is pleased to work with Constellation Brands on the premiumization strategy guiding the sale transaction.

Tags: arbor mist, clos du bois, primal roots, rex goliath, robert mondavi, robert mondavi private selection, robert mondavi winery, kim crawford, ruffino, the prisoner wine company

On April 3, 2019, Constellation Brands, Inc. signed an agreement with E. & J. Gallo Winery, to divest approximately 30 brands from its portfolio principally priced at $11 USD retail and below, and related facilities located in California, New York, and Washington. The sale transaction for $1.7 billion USD is subject to the satisfaction of certain closing conditions, including the receipt of regulatory approval, and is expected to close at the end of the company’s first quarter of fiscal 2020.

"One of the hallmarks of our success over the years has been our ability to evolve and stay on the forefront of emerging consumer trends,” said Bill Newlands, Constellation Brands president and chief executive officer. “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. 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."

Some of the brands transitioning to E. & J. Gallo include Arbor Mist, Clos du Bois, Primal Roots, and Rex Goliath yet Constellation’s remaining wine and spirits portfolio represents a collection of powerhouse brands such as the iconic Robert Mondavi brand family; The Prisoner Wine Company brand family; Kim Crawford; Ruffino, a leading brand family of Italian wines; Meiomi, the #1 pinot noir in the U.S.; and SVEDKA Vodka, to name a few. We are energized by the opportunities we see ahead with this portfolio and are confident it is one that will win with consumers.

"We thank our distributors for past efforts with the collection of brands involved in this transaction,” commented Brian F. Cabral, Stansfeld Scott’s president and chief executive officer, “and we look forward to further develop the reconfigured Constellation Brands, Inc portfolio”.