Actor George Clooney's tequila business sold for $1bn
What's the story
Hollywood star George Clooney now has another reason to celebrate as his tequila company Casamigos was sold to British drinks giant Diageo in a whopping $1bn-worth deal.
The deal comes at a time when the world's largest spirit maker, Diageo, wants to boost its presence in the market.
Clooney welcomed twins, Ella and Alexander, with his wife Amal earlier in June.
Brand
Casamigos was first available only for private events
Casamigos was founded by George Clooney and his friends, entrepreneur Rande Gerber and real estate developer Mike Meldman, in 2013.
According to them, Casamigos, which means 'house of friends', was born from tequila-filled nights.
After the deal was finalized, Clooney said he and the other co-founders would certainly remain a part of Casamigos and continue to promote the brand.
Deal details
The Deal: Diageo's plans to expand Casamigos globally
The British spirit maker, Diageo, said it plans to expand Casamigos's business internationally.
The drinks giant would initially pay $700 million for the brand.
A further payment of $300 million will follow if the sales hit targets; it is linked to performance over ten years.
To maximize the future growth, Diageo would build on the "significant international potential" of Casamigos.
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Diageo's statement
In a news release, Diageo stated that Casamigos "has delivered impressive growth, reaching 120,000 cases in 2016, primarily in the U.S." It said the tequila company is expected to top 170,000 cases by the end of 2017.
Not an entrepreneur?
Initially reluctant to start a company
Casamigos began after Clooney and Gerber, Cindy Crawford's husband, built neighboring vacation homes in Mexico's Cabo San Lucas.
They were working with a Mexican distiller to create the tequila, which became Casamigos.
It was after the distiller told they need a license for making nearly 1,000 bottles each year that they reluctantly created the firm.
However, they had no intention to sell it.
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Co-founder Rande Gerber's statement
In 2013, Casamigos's tequila went on store shelves for the first time. Currently, the brand's 750ml bottles retail for around $50. Gerber stated the idea to make a smooth house tequila, "has quickly turned into the fastest growing super-premium tequila."
Expansion
Expanding to Europe, source of growth for Casamigos: Diageo
Diageo stated Casamigos would be neutral to earnings in the first three years and later add to earnings.
However, it didn't comment on the revenue figures Casamigos would provide.
The drinks giant also has arrangements with many other celebrities including David Beckham and Sean Combs among others.
On the rising Mexico-US tensions, Diageo said it doesn't anticipate such barriers would affect its growth.