Constellation snaps up Fortune Brands' wines

Constellation Brands, headquartered in Fairport, NY, has purchased Fortune Brands Inc.'s wine business.

Constellation, the world's biggest winemaker, announced it is paying $885 million for the U.S. wine business of Fortune which owns the Clos du Bois, Wild Horse and Geyser Peak brands, five California wineries and more than 1,500 acres of vineyards in the state's Napa, Sonoma and Los Carneros grape-growing regions.

The deal increases Constellation's percent of the market by one point to 20%. It has about 5% of the highly-fragmented global wine market.

Constellation owns more than 300 brands run from jug wines to high-end California reds such as Ravenswood and Estancia, beer imports such as Corona and St. Pauli Girl and liquors such as Fleischmann's vodka, Skol gin and Black Velvet Canadian whiskey.

It has been on a buying spree in recent years, acquiring Australian vintner BRL Hardy Ltd. in 2003 for $1.1 billion in cash and stock in a deal that made it the world's largest wine business. It then bought Robert Mondavi Corp. for $1.3 billion. Last year, it bought Canada's Vincor International Inc. for nearly $1.1 billion.

"This portfolio is an excellent fit and furthers our strategy of exceeding consumer expectations and expanding our presence in the growing high-end segments of the wine market," said Chief Executive Rob Sands.

"One of the advantages we have is because we have critical-mass volume, we have some economies of scale and also the breadth of distribution that helps us gets more brands to more markets," said company spokesman Mike Martin. "That helps ensure that many of our brands are available just about anywhere a consumer would want to go, whether it's a grocery store, a liquor store or a wine specialty store."

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