Media studies urged Diageo was contemplating asset gross sales to spice up progress, cashing in on excessive demand for Guinness.
UK drinks firm Diageo has denied that it’s contemplating a sale of its Guinness model, together with a 34% stake within the champagne and cognac enterprise, Moët Hennessy.
In an announcement launched on Sunday, Diageo insisted that it had “no intention to promote both”, responding to media studies launched days earlier.
Bloomberg Information reported on Friday that Diageo was reviewing its portfolio in an effort to revive progress.
The report stated that Guinness, which could possibly be privately offered or publicly listed, could possibly be valued at greater than $10 billion (€9.5bn).
The Irish stout model is an outlier in Diageo’s portfolio, which focuses predominantly on spirits.
Guinness’ reputation has nonetheless rocketed not too long ago as social media has boosted its enchantment amongst younger shoppers.
The “break up the G” development has notably fuelled demand. The web problem includes drinkers swallowing sufficient Guinness on their first swig so the remaining liquid lands midway by way of the G on a branded glass.
Guinness drinkers within the UK subsequently confronted shortages across the festive interval, main some pubs to ration the stout.
A sale of the model, which now seems unlikely, may present a money injection for Diageo amid a rocky interval.
Cooling demand in China and the US has hit margins, and a build-up of unsold stock in Mexico and Brazil compelled the agency to situation a revenue warning in 2023.
Spirit gross sales have dipped for the reason that pandemic – partially as shoppers hit by inflation search for cheaper alcoholic options.
Guinness gross sales have in the meantime grown by double digits yearly since 2021.
Diageo stated in Sunday’s assertion that it might subsequent replace the market with half-year outcomes on 4 February.
Analysts have urged that progress targets could possibly be downgraded.