Diageo, the world's largest spirits company, said on Wednesday it had taken a majority stake in distilled non-alcoholic spirits brand Seedlip, as it looks to cater to a growing population of teetotalers.
The maker of Johnnie Walker whisky and Tanqueray gin bought a 20% stake in the maker of spice-based drinks in 2016 through its venture capital arm Distill Ventures.
Diageo uses Distill Ventures to invest in small brands that tap into emerging consumer tastes and trends. So far, the venture has invested more than £60 million (€65.14 million) in about 15 drinks brands.
Shares of Diageo, which did not disclose the terms of the transaction, were up 1%.
Alcohol Consumption Trends
The deal comes at a time a growing proportion of young drinkers in Great Britain claim to abstain from drinking alcohol.
Teetotalism in Great Britain increased to 22% in 2017 from 19% in 2005 for those aged between 16 and 24 years, according to a 2018 report from the Office of National Statistics. That equates to about 10.2 million people.
Founded by Ben Branson, Seedlip has a presence in more than 25 countries, including the UK, Australia and the United States and is sold in three spice variants.
Commening on the deal, Branson, said, "We want to change the way the world drinks and today’s news is another big step forward to achieving this.
"Distill Ventures’ and Diageo’s shared belief in our vision has enabled us to build a business that’s ready for scale and I’m excited to continue working with Diageo to lead this movement," he added.
'A Game-Changing Brand'
John Kennedy, the president of Diageo Europe, Turkey and India, said, "Seedlip is a game-changing brand in one of the most exciting categories in our industry. Ben is an outstanding entrepreneur and has created a brand that has truly raised the bar for the category."
In the UK, Seedlip is sold at outlets including Selfridges, Waitrose, Sainsbury's and Tesco.
Branson will retain a minority shareholding in the company, Diageo said.
News by Reuters, additional reporting by Dayeeta Das. Click subscribe to sign up to ESM: European Supermarket Magazine.
