Diageo slims down Chateau & Estate Wines arm

Diageo slims down Chateau & Estate Wines arm

Diageo's US wine business, Diageo Chateau & Estate Wines, has agreed to sell Bordeaux merchant house Barton & Guestier to France's Castel Freres for an undisclosed fee.

Castel will pick up the brands, stock and land owned by Barton & Guestier, including Chateau Magnol, Diageo said late yesterday (20 July).

The move is part of Diageo's strategy to streamline its Chateau & Estate Wines business.

Diageo has sought to scale back its operations in Bordeaux wine since last year, when the group confirmed that it was exiting the market for first-growth Bordeaux in the US.

In May, the drinks giant announced that it would cut jobs and sell some non-core wine brands as part of "fundamental changes" to be made at Chateau & Estate Wines (DC&E).

"DC&E remains committed to our French Agency business and our dedicated Diageo distributor network across the country will continue to handle these wines as we have done with pride and success for many years,” said Sandra LeDrew, president of sales & marketing at DC&E.

Diageo said that it also remains committed to wine over the long-term, but intends to focus its efforts on core brands like Beaulieu Vineyard wines, Sterling Vineyards, Chalone, Acacia, Rosenblum Cellars and Provenance.

The group, however, is seeking to refocus its Bordeaux wine business on Europe and Asia. It will use its Vignobles Internationaux and Justerini & Brooks businesses to continue trading in Bordeaux wines in these regions.