Diageo trades Ciroc North America rights for majority stake in Tequila Brand Lobos 1707
Diageo restructures spirits portfolio by swapping Ciroc North America brand rights for global majority control of Lobos 1707 Tequila.
USA – Diageo has entered a joint venture with U.S. investment firm Main Street Advisors, exchanging majority ownership of vodka brand Ciroc in North America for a controlling interest in Tequila brand Lobos 1707 globally.
The strategic partnership reflects Diageo’s continued focus on expanding its presence in the premium tequila market.
Financial terms of the deal were not disclosed.
Under the agreement, Diageo will retain rights to the Ciroc brand outside North America, while taking over the global majority stake in Lobos 1707. The new venture is expected to strengthen both brands through combined resources and marketing expertise.
The deal follows Diageo’s prior involvement with Sean “Diddy” Combs, who played a key role in promoting Ciroc under a marketing partnership that began in 2007. That collaboration ended in 2023 amid a legal dispute, which was settled in January 2024.
At the time, Diageo also announced it had acquired full ownership of DeLeon Tequila, another brand developed in partnership with Combs.
The company’s latest move comes after Bloomberg reported in December 2023 that Diageo had explored interest from potential buyers for the Ciroc brand.
Ciroc has experienced declining sales, with net sales dropping 32% and volumes falling 28% on an organic basis in the six months to December 31.
For the year ending June 30, 2023, Ciroc recorded a 26% decline in net sales and a 23% drop in volumes.
Lobos 1707, launched in 2020 by Diego Osorio, offers a portfolio that includes reposado, añejo, and extra añejo tequilas, as well as a mezcal. While its principal market is North America, the brand expanded into the UK through Selfridges in late 2023.
Paul Wachter, founder and CEO of Main Street Advisors, said the collaboration with Diageo aims to drive growth and unlock new opportunities for both brands. The venture appointed former TikTok executive Nick Tran as president and chief marketing officer.
Tran emphasized the need for spirits brands to evolve in line with changing consumer behavior, particularly in digital spaces and social engagement.
Diageo says the partnership will leverage each company’s strengths to build long-term value for Ciroc and Lobos 1707.
Sign up HERE to receive our email newsletters with the latest news and insights from Africa and around the world, and follow us on our WhatsApp channel for updates.
