Just Drinks reported on Thursday that Constellation Brands sold off six wine brands that sit in what the supplier refers to as “the declining mainstream segment,” and one of the brands was the popular Central Coast wine brand Meiomi. The deal is projected to bring $900 million in revenue to the supplier during its new financial year.
“This transaction reflects our multi-year strategy to reconfigure our business, resulting in a portfolio of higher-end wine and craft spirits brands that are aligned to evolving consumer preferences and help bolster our competitive position,” Constellation President and CEO Bill Newlands said in a statement according to JustDrinks.
In a push for premium, Constellation is holding on to its “$15 and above” brands including Kim Crawford and Robert Mondavi. This marks the second sell-off within three years, after Constellation sold brands like The Dreaming Tree and 7 Moons to The Wine Group.
Though some could interpret another selloff as a sign of troubles on the horizon for Constellation, experts claim the opposite.
“A divestment of the wine business, or a portion of it, has been desired by investors for a long time, and this news should be taken positively,” said analyst Nadine Sarwat.
As far as numbers go, Constellation reported that net sales grew by 2%. Operating income dropped to $355 million, and a net loss of $81 million was reported by Constellation at the end of their 2024/25 fiscal year.
It doesn’t look like a rosier outlook for beer sales, and Reuters reported that one of Constellation’s top drivers, Corona, dropped about 4%. Corona is considered the second-largest beer company in the United States, but demand has waned, and the outlet suggests some of it could stem from the tariffs President Donald Trump imposed on Mexican-made goods
Constellation has been shaking things up outside of its portfolio as well. The brand scrapped its DEI programs on Tuesday, according to Reuters.
Newlands claimed the move was in response to President Trump’s executive order aimed at federal agencies urging them to “end illegal DEI discrimination and preferences.”
“As we’re all fully aware, we are operating in an increasingly polarized and highly charged environment, and a shifting legal landscape related to social and political issues,” Newlands explained regarding the company’s decision.
Constellation Brewing renamed its DEI arm to the “inclusive culture team,” according to Reuters. The outlet reported that the brand shared it would be shifting away from supplier diversity to focus more on local small businesses.
No responses yet