Don Julio and Casamigos
2017
$2.1B
Why
Diageo acquired the ultra-premium tequila brands Don Julio and Casamigos for a combined $2.1 billion, betting heavily on the continued double-digit growth of the premium tequila category in the United States and securing long-term, low-cost raw material supplies in the Jalisco region of Mexico.
Impact
The acquisition immediately positioned Diageo as a dominant player in the ultra-premium tequila segment, driving massive top-line growth and margin expansion as the global consumer palate shifted toward premium, craft-produced Mexican spirits.
Outcome
Despite the severe inventory destocking in 2024, the long-term strategic value of the acquisition remains immense, as Diageo's massive investments in Mexican agave fields and distillation capacity provide a significant cost advantage and secure the long-term supply of raw materials needed to fuel future growth.