USA Constellation Brands has signed two agreements with Sazerac Company, one of America’s oldest privately held distillers, and E. & J. Gallo Winery to divest a portion of its alcoholic beverage portfolio in transactions valued at approximately US$355 million.

As part of the company’s wine & spirits transformation, Constellation has agreed to sell its Paul Masson Grande Amber Brandy brand, related inventory and interests in certain contracts to Sazerac Company for about US$255 million.

The beverage alcohol company said that the deal, which is subject to certain purchase price and closing adjustments, requires FTC review and clearance and is expected to close in the second quarter of fiscal 2021.

Constellation has also confirmed a separate agreement with E. & J. Gallo Winery to divest its New Zealand Nobilo Wine brand and certain related assets and liabilities for US$130 million, subject to purchase price and closing adjustments.

The company said that the Nobilo transaction is expected to close by the end of the second quarter of fiscal 2021. The agreement was previously announced in December 2019 when the company’s agreed to revise their original acquisition deal from US$1.7 billion to US$1.1 billion.

The acquisition is subject to change on closing of the further amended revised deal announced in May this year, in which Constellation agreed to divest a portion of its wine and spirits portfolio principally priced at US$11 retail and below, and certain related facilities to E. & J. Gallo Winery for approximately US$1.03 billion.

In the new US$1.03 billion deal, Constellation and Gallo Winery agreed to exclude Mission Bell facility and certain related real estate, equipment, contracts, and employees from the transaction. The initially was announced in April 2019 and was valued at US$1.7 billion.

The Corona beer maker said that US$250 million of the revised deal is an earnout if brand performance provisions are met over a two-year period after closing. Constellation still expects the revised transaction to close in the second quarter of fiscal 2021, subject to FTC review and clearance.

“These agreements represent another step forward in our efforts to transform our wine and spirits business,” said Bill Newlands, president and chief executive officer at Constellation Brands. “We look forward to closing these transactions in the coming months.”

Constellation’s remaining wine and spirits portfolio represents a collection of Power Brands including the Robert Mondavi brand family, The Prisoner Wine Company brand family, Kim Crawford, Ruffino, Meiomi and SVEDKA Vodka.

The company’s portfolio also includes brands such as SIMI, Schrader Cellars, Mount Veeder Winery wine brands, High West Whiskey and Casa Noble Tequila, as well as new premium wine innovations such as Cooper & Thief, 7 Moons and Crafters Union.

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