Fortune Brands sells U.S. wine business |
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Mon, 12 Nov 2007 14:21
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DEERFIELD, Ill. (AP) - Fortune Brands Inc., which makes consumer products ranging from Jim Beam bourbon to Moen faucets, said Monday it agreed to sell its U.S. wine business to beer, wine and spirits company Constellation Brands Inc. for $885 million.Brands being acquired include Clos du Bois, Geyser Peak and Wild Horse as well as more than 1,500 acres of vineyards in California and five California wineries. The company said the wine brands included in the transaction had 2006 sales of 2.6 million 9-liter cases and revenue of $214 million including excise taxes.Fortune Brands will retain the Harveys sherry and Cockburns port brands.The company will receive about $840 million after taxes, and will realize a gain of about $50 million to $60 million on the sale.Fortune Brands said the move allows it to focus on its higher-margin spirits business, while Constellation said the move bolsters its position in the U.S. premium wine business.The sale, expected to close by Dec. 31, is expected to 'slightly' reduce both companies' 2008 earnings. Constellation, which is financing the deal with debt, said the purchase will add slightly to earnings per share in 2009.Fortune Brands was advised on the transaction by Citi and Credit Suisse as financial advisers and Pillsbury Winthrop Shaw Pittman as legal adviser.Copyright 2007 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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Constellation enters agreement to acquire Fortune's U.S. wine business for $885M 