This article was highlighted for PRO subscribers, Seeking Alpha’s service for professional investors. Find out how you can get the best content on Seeking Alpha here.

Diageo (DEO) made big news recently when it sprung for Aviation Gin. It is paying a headline $610 million for the ultra-premium gin brand. There’s more nuance to the deal than just that figure though. Diageo is paying $335 million upfront, with the other $275 million coming into play if Aviation hits certain revenue targets over the next decade. In addition to limiting risk that way, Diageo also acquired numerous other smaller brands along with Aviation in this agreement.

Aviation, for those unfamiliar, was launched to popularity by actor Ryan Reynolds. He used a series of guerrilla marketing tactics to promote Aviation, including a famous ad with “Peloton wife” actress Monica Ruiz last year.

Some people have complained about Aviation deal, saying it’s

Read More

Diageo PLC said Monday that it has acquired Davos Brands LLC and Aviation American Gin LLC for a total consideration of $610 million.

The deal includes an initial payment of $335 million and potential for up to $275 million additional based on Aviation’s performance over the next decade. It will be funded through existing cash and is expected to close before the end of 2020.

“Deadpool” actor Ryan Reynolds is one of the owners of Aviation American Gin; he’ll retain a stake in the brand. Based in New York, other brands in the Davos lineup include Astral Tequila and TYKU Sake.

Aviation is the second-largest “super premium” gin brand in the U.S., according to Diageo
DEO,
+1.14%

DGE,
+1.22%

. “Super premium” gin grew at a compound annual growth rate of 18.5% between 2014 and 2019.

See:Millennials’ shifting tastes are boosting sales of whiskey and tequila


“We’re so

Read More

Diageo  (DEO) – Get Report the world’s biggest liquor merchant, said on Monday that it’s buying Aviation American Gin, co-owned by the movie actor Ryan Reynolds, through its purchase of Aviation Gin LLC and Davos Brands LLC.

The deal price is as much as $610 million. The price “includes an initial payment of $335 million and a further potential consideration of up to $275 million based on the performance of Aviation American Gin over a 10-year period,” the U.K. company said in a news release.

“This reflects the brand’s current growth trajectory and expected upside potential.”

It didn’t hold back the hype about Reynolds’ brand. “Aviation American Gin is an American-style gin crafted with a blend of botanicals, with subtle juniper notes, delivering a smooth balanced flavor profile,” the company said.

“The brand has thrived under the leadership of its majority owner, Davos Brands, and the creative direction

Read More