Diageo is paying George Clooney and two of his buddies — Rande Gerber and Mike Meldman — up to $1 billion for Casamigos, the tequila brand they started four years ago because they themselves wanted better-tasting firewater after engaging in some disappointing sampling during time off in Mexico.
Diageo, meanwhile, “wants to better tap into the market for ‘super-premium’ tequila, whose sales have soared in the last decade and now account for 18% of U.S. volume shipments of tequila, according to the Distilled Spirits Council trade group,” reports James F. Peltz for the Los Angeles Times.
“The upscale tequilas in turn have led to a doubling of the overall tequila market since 2003, to nearly 16 million cases last year. U.S. tequila sales at the supplier level totaled $2.5 billion in 2016, council data show,” Peltz continues.
As for Casamigos’ slice of the lime, it “sold 120,000 9-liter cases last year, mainly in the U.S., and is expected to reach more than 170,000 this year,” Julia Kollewe reports for The Guardian. It comes in three varieties, priced at $45-55 a bottle.
“The company began after Clooney and Gerber built neighboring vacation homes in Cabo San Lucas, Mexico,” relates NPR’s Bill Chappell. “‘As you do when you're in Mexico, you drink a lot of tequila,’ Gerber told CNBC last year, explaining how he and Clooney came up with the idea of designing a tequila to their own tastes.
“They worked with a distiller in Jalisco, Mexico, to create the tequila that became Casamigos — but did not have any intention of selling it. After the distiller told them they needed to get a license to go along with the roughly 1,000 bottles they were making each year, they reluctantly created the company, Gerber said.”
Back at the grind, Meldman is a developer — “real estate’s party boy,” according to a Nancy Keates’ profile in the Wall Street Journal last year. He is “a tycoon who describes his resorts as ‘frat houses for families’ [and] owns six homes that are optimized for entertaining — especially for beer pong,” the subhed informs us.
Gerber is a former model who has accumulated about $100 million, according to Alison Millington’s profile last month in Business Insider. Besides being “George Clooney's business partner, Cindy Crawford’s husband and father to two budding supermodels,” Gerber co-founded Gerber Group, “a chain of luxury bars, restaurants, and lounges” with his brothers Scott and Kenn.
“The essence of the brand, ‘made by friends for friends,’ is reflected in the name, Casamigos or ‘house of friends’,” according to the release announcing the “definitive agreement” yesterday. The three equal partners will be paid $700 million up front and as much as $300 million based on a performance linked earn-out over 10 years. That extra moola will also keep the three active in promoting the brand.
Quips about the deal came fast and facile.
“It’s a good thing Amal Clooney put her foot down when George Clooney suggested naming the couple's twins ‘Casa’ and ‘Amigos,’ because Clooney's ultra-premium tequila line, Casamigos, is no longer the family business,” reads the blurb for a piece in Forbes about a quip Cooney made in March.
“Finally, Something Goes George Clooney's Way,” reads the headline on Esquire.com. “When is enough for you?” asks Nate Erickson. “Was it not just being George Clooney? The soothing baritone voice? The perfect bone structure and kind, thoughtful eyes? Those (two!) Academy Awards? The perfect hairline over a salt and pepper coif that tells the world, “‘I've been around,but I'll be around?’ You scoundrel. You rogue.”
“The acquisition marks the biggest celebrity beverage score to date. Coca-Cola's $4.2 billion purchase of Vitaminwater maker Glaceau in 2007 yielded roughly $100 million for rapper 50 Cent, who owned a tiny slice of the beverage company. Three years later, Beam bought Real Housewife Bethenny Frankel's SkinnyGirl for an estimated $100 million,” reports Natalie Robehmed for Forbes.
“If you asked us four years ago if we had a billion-dollar company, I don’t think we would have said yes,” Clooney says in a widely published statement. “This reflects Diageo’s belief in our company and our belief in Diageo. But we’re not going anywhere. We’ll still be very much a part of Casamigos. Starting with a shot tonight. Maybe two.”
Nice non-work if you can get it.