Constellation Brands Sells Svedka Vodka to Sazerac

Constellation Brands has announced the sale of its Svedka vodka brand to leading global beverage company Sazerac. The transaction is expected to be completed in the coming months. Svedka vodka represents a low single-digit percentage of Constellation Brands' net sales and approximately 1% of U.S. scanner data.

However, the brand accounts for a significant portion of the company's alcoholic beverage sales, representing over 75% and approximately 11% of wine and spirits (W&S) segment sales according to Nielsen data.

Constellation Brands stated that this move aligns with its strategy to realign its wine and spirits portfolio to better fit changing consumer tastes and market dynamics. The company is focusing on the premium segment of the wine and spirits market.

Citi expressed a positive outlook on the sale, noting that it would remove a low-performing brand from Constellation Brands’ portfolio. This step is seen as a continuation of the company's efforts to streamline its wine and spirits segment.

The sale of Svedka is part of Constellation Brands' strategy to focus on higher-priced and more profitable categories within the alcoholic beverage market. This reflects a trend where companies adapt to shifts in consumer preferences that increasingly favor premium products.