Spirits Giant Diageo Adds Don Papa Rum to Portfolio With $280M Acquisition

Don Papa is a rum brand from the Philippines that was launched in 2012 (Photo: Don Papa Rum/Facebook)

UK based spirits giant, Diageo announced on Jan. 17 that it had reached an agreement to buy Don Papa Rum for €260 million (about $280 million). A further potential consideration of up to €177.5 million through 2028 is subject to performance. This means the purchase of the Filipino rum brand could total €437.5 million when everything is settled. 

“We are excited by the opportunity to bring Don Papa into the Diageo portfolio to complement our existing rums. This acquisition is in line with our strategy to acquire high growth brands with attractive margins that support premiumization, and enables us to participate in the fast growing super-premium plus segment,” said John Kennedy, President, Diageo Europe and India.

Diageo owns over 200 alcohol brands including the rum brands Captain Morgan, Zacapa, Pampero and Myer’s Original.

The Don Papa brand has seen considerable growth over the past several years. It was first launched in 2012 by co-founders Stephen Carroll and Andrew John Carcia. Strategically the brand follows the trend of premiumization of rum which many have mixed feelings about. Regardless, the brand has seen a compound annual growth rate of 29% in Europe between 2016-2021. 

Carroll was a former Rémy Cointreau executive, the brand behind Rémy Martin cognac, before establishing the Bleeding Heart Company which makes Don Papa. Carroll is based in the UK but decided that the Philippines had the potential to develop high-end rum. 

The rum is distilled in the  Philippines by the Ginebra San Miguel group. The group is the majority owner of the San Miguel Corporation on the island of Negros Occidental in the Philippines, often referred to as “Sugarlandia.” 

Carroll said, “Diageo has a strong track record in nurturing founder-led brands. They believe in our unique story and have genuinely embraced our brand idea. We believe this acquisition is a great opportunity to take Don Papa into the next exciting chapter of its development.”

Reportedly, Carroll will remain involved with the brand after the acquisition is complete. 

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