Constellation will also acquire five wine brands from Washington winery Charles Smith Wines

Constellation will also acquire five wine brands from Washington winery Charles Smith Wines

Constellation Brands has confirmed it is to offload its Canadian wine division for just over CAD1bn (US$761m) while buying a premium wine range from Charles Smith Wines for US$120m.

The company said today the Canadian unit, which includes brands such as Jackson-Triggs and Inniskillin, will be sold to Ontario Teachers' Pension Plan. The CAD1.03bn price tag is valued at 12-times the unit's EBITDA, Constellation said.

The sale of the Canadian business brings to end Constellation's interest, first announced in April, in exploring an initial public offering for it. Earlier this month, the Wall Street Journal reported that Constellation had received several offers for the division and was now eyeing a sale.

Explaining the turnaround, Constellation CEO & chairman Rob Sands said today: "We seized the opportunity to sell the entire business in a value-enhancing transaction when it presented itself."

The company will retain ownership of Black Velvet Whisky and the Canadian whisky brand's production facility in Lethbridge, Alberta, Canada.

Meanwhile, Constellation will pick up five "super and ultra-premium" wine brands from Washington winery Charles Smith. The transaction, expected to close in October, includes Kung Fu Girl Riesling, Velvet Devil Merlot, Boom Boom! Syrah, Eve Chardonnay and Chateau Smith Cabernet Sauvignon.

The company today also closed its High West Distillery acquisition, a US$160m deal first announced this month

Inside Constellation Brands' acquisition strategy - Analysis

The acquisitions are in line with Constellation's stated aim of buying high-margin brands across all alcohol categories. Last week, Sands told analysts that the group is in a "position to attack anything" in M&A.