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Patron bottles

Source: Patron / Patron

Bacardi owns a lot of brands. The latest addition to its sizeable portfolio is Patron tequila in a deal worth a reported $5.1 billion. 

Reports Reuters:

Jefferies analysts put the price at about 25.5 times Patron’s estimated operating earnings and 7.5 times its sales. That is well below the estimated 20 times sales that Diageo paid for Casamigos, but Patron is a much more mature business, with estimated sales of about $675 million per year, versus only about $50 million for Casamigos.

The deal comes days after Pernod Ricard bought out Avion Tequila and months after Diageo bought George Clooney’s Casamigos tequila for up to $1 billion.

Jefferies analysts put the price at about 25.5 times Patron’s estimated operating earnings and 7.5 times its sales. That is well below the estimated 20 times sales that Diageo paid for Casamigos, but Patron is a much more mature business, with estimated sales of about $675 million per year, versus only about $50 million for Casamigos.

Tequila sales, still largely confined to North America, are growing faster than the overall alcoholic drinks market as high-end brands help tequila shrug off its image as a party drink.

The tequila market is hot in the United States. Recently, Pernod purchased Jeezy’s Avion tequila brand.

The deal with reportedly close in the first half of 2018. Some of the other brands owned by Bacardi include Grey Goose, Bombay Sapphire and Dewar’s.

Photo: Courtesy of Patron Spirits

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