Diageo and Sean “Diddy” Combs partnering to acquire the DeLeon tequila brand

The new, 50/50 joint venture of Diageo and Combs Wine & Spirits springs from a pre-existing strategic alliance of the two companies to develop the Ciroc brand of ultra-premium vodka, which has climbed from just 50,000 cases a year to a brand selling almost 2 million cases in the same period of time.DeLeon is a boutique brand of 100-percent agave tequila with loyal followers in Hollywood and the U.S. music industry. The brand attracts a group of consumers aware of their status whose chosen brands of liquor reflect their privileged, luxurious lifestyle. The acquisition of DeLeon will accelerate Diageo’s share of the ultra-premium tequila market for brands that sell for over US$40 dollars a bottle, which is the second fastest-growing tequila segment in the United States, according to Nielsen.“The joint venture with Combs Wine & Spirits and its purchase of DeLeon is Diageo’s latest step towards returning to a leading position in tequila in North America,” said Larry Schwartz, president of Diageo North America. “Expanding our relationship with Sean Combs into tequila was a natural choice given Sean’s ability to galvanize support for luxury brands, as we’ve seen with our work together on Cîroc”.