Diageo buys Philippine rum brand Don Papa for initial €260 million; details here

UK-based distiller Diageo has inked a deal to buy high-end Philippine rum brand Don Papa. According to a Financial Times report, the deal could be over €400 million. Diageo will pay €260 million initially. The Captain Morgan rum brand manufacturer will then pay a potential €178 million more, subject to the brand’s performance. The deal is expected to be finalised in the first half of 2023 and will be funded through existing cash reserves. Don Papa was advised by banker Spayne Lindsay, while Centerview was the advisor for Diageo during the negotiations. Diageo Europe and India President John Kennedy said: “We are excited by the opportunity to bring Don Papa into the Diageo portfolio to complement our existing rums. He added that the move is in line with Diageo’s strategy to “acquire high-growth brands with attractive margins that support premiumisation, and enables us to participate in the fast-growing super-premium-plus segment.” Don Papa’s acquisition had attracted a lot of bids. Founded in 2012 by former Rémy Cointreau executive Stephen Carroll, the Don Papa brand was developed around the character of Papa Isio, a former sugar plantation worker who was a leader in the Philippines’ revolution against Spain in the 1890s. The rum is distilled by drinks group Ginebra San Miguel, where the San Miguel Corporation owns the majority stake, on the Philippines island of Negros Occidental and is aged in American oak barrels. Carroll will remain with the brand and work closely with Diageo. He, along with Don Papa co-founder Andrew John Garcia had grasped an opportunity to develop a high-end rum in the Philippines. Don Papa is currently available in 30 countries with France, Germany and Italy as its biggest markets. Carroll said about the deal, “Diageo has a strong track record in nurturing founder-led brands. They believe in our unique story and have genuinely embraced our brand idea. “We believe this acquisition is a great opportunity to take Don Papa into the next exciting chapter of its development.” The deal is the latest in the line of global drinks groups acquiring high-end rum brands, including Brown-Forman’s buying Venezuelan brand Diplomático last year. Diageo has made strides in the sector with high-end acquisitions such as George Clooney’s Casamigos tequila brand in 2017, and Don Julio tequila in 2014. It also acquired Balcones Distilling, a high-end Texas whisky distiller in 2022. Read all the Latest News, Trending News, Cricket News, Bollywood News, India News and Entertainment News here. Follow us on Facebook, Twitter and Instagram.