Constellation Brands divested the majority of its popular and mainstream wine and spirits portfolio in 2021, highlighting its strategy to focus predominantly in premium fine wine and craft spirits. (E. & J. Gallo Winery gained wines principally priced at $11 retail and below for $810m in February 2021).
Now, the additional divesture to California’s The Wine Group (the value of which has not been disclosed) leaves Constellation Brands with ‘a more focused set of leading, powerful brands aligned with consumer preferences’, spanning mainstream, premium, fine wine and craft spirits segments.
Focus on The Prisoner, Kim Crawford and more
Constellation Brands’ wine portfolio is now centered on Meiomi, Kim Crawford, The Prisoner Wine Company, The Robert Mondavi family of brands, High West Whiskey, Casa Noble Tequila, Schrader Cellars, Double Diamond, To Kalon Vineyard Company, SIMI, My Favorite Neighbor portfolio of brands, Lingua Franca, Nelson’s Green Brier and others.
“A key driver of our success has been our relentless focus on consumer preferences, including long-term consumer-led premiumization trends, and remaining agile in our approach to stay ahead of evolving marketplace dynamics,” said Robert Hanson, EVP & President, wine and spirits division.
“Over the past three years, we reshaped ourselves into a higher-end wine and spirits division with intentional, strategic mainstream plays and are moving our business towards becoming a leading global Premium/Fine Wine & Craft Spirits portfolio.
"This transaction [with The Wine Company] will enable us to focus and shift our portfolio towards the higher end, positioning ourselves to continue delivering industry-leading growth and shareholder value with the right portfolio for our ambitions.
"In turn, The Wine Group is acquiring great brands that complement its current strategy of continuing to build a premium wine portfolio.”
Constellation Brands’ wine strategy saw it invest in La Fête du Rosé (a ‘disruptive brand geared toward multicultural consumers’) and California’s Sapere Aude Sparkling Wine in 2021.