From Bottles to Brands: Diageo’s Next Chapter
When Diageo announced in May 2025 that it would sell its Santa Vittoria d’Alba production facility to Italian food and beverage group Newlat Food—soon to rebrand as NewPrinces—the industry barely blinked. No ticker shock. No headlines screaming about a collapse. But dig deeper, and this move tells us a lot about where the global spirits market is headed—and what matters now more than ever: agility, premiumization, and the illusion of still being everywhere while actually owning far less ground.
For Diageo, it wasn’t just about a plant. It was about a mindset shift.
What Exactly Was Sold?
Let’s set the record straight: Diageo didn’t sell any brands. Not a drop of Johnnie Walker, not a whisper of Baileys. The transaction centered around the manufacturing plant in northern Italy, which had previously been slated for closure in January 2025—affecting 350 jobs 1.
Instead of pulling the plug entirely, Diageo inked an exclusivity deal with Newlat in May, offering the Italian company full control of the facility, a commitment to preserve all 349 jobs, and the rights to continue producing select ready-to-drink (RTD) and low/no-alcohol beverages that were previously manufactured at the site 2.
So, what changed? Everything—and nothing.
The Asset-Light Playbook
To understand Diageo’s move, you have to step back from the vineyard and look at the entire estate. The Santa Vittoria plant sale is just one piece of a much broader strategic puzzle.
In the past year alone, Diageo has:
- Exited its stake in Guinness Ghana to Castel Group for $81 million 3.
- Shut down the Chase Distillery in Herefordshire after just three years, citing brand overlap 4.
- Abandoned plans to sell Pimm’s, after failing to find a buyer that aligned with their premium portfolio vision 5.
It’s textbook modern strategy: offload lower-performing, asset-heavy operations while doubling down on high-margin, brand-driven categories. This approach gives Diageo room to focus on the jewels in its crown—Scotch whisky, tequila, and fast-growing emerging markets across Latin America and Asia 6.
If you’re still picturing Diageo as a boots-on-the-ground beverage manufacturer, you’re looking at a ghost. What they want to be seen as is a global curator of premium experiences—not a builder of bottling lines.
What’s in It for Newlat (NewPrinces)?
This isn’t charity, and it’s not just operational cleanup. Newlat’s play is shrewd.
The acquisition marks NewPrinces’ first significant step into alcohol production, expanding their presence beyond food staples and into beverages that carry not just flavor, but status. With RTDs and no/low-alcohol segments trending hard across Europe, this gives them a turnkey launchpad into a lucrative and fast-growing market 7.
Even better? They get the local workforce, equipment, and operational expertise already humming inside the plant—no startup phase, no labor negotiations, no messy transitions. They walk in, flip the switch, and go.
And if they’re smart—which this move suggests they are—they’ll soon start courting contract bottling opportunities for smaller spirits and beverage brands across the continent.
What About the Brands Themselves?
For consumers and collectors, nothing changes—yet. Diageo still owns the recipes, the labels, and the brand equity. But the supply chain shifts.
The risk? Subtle inconsistencies in production if NewPrinces tinkers with methods or sources. The reward? Better margins and sharper focus on core markets. As long as quality is maintained, nobody’s canceling their dinner party over the production zip code on a can of Gordon’s gin & tonic.
However, watch for this move to inspire similar pivots from other large spirits companies. Why sink capital into brick and mortar when co-manufacturing and licensing can achieve the same reach with half the cost?
The Human Side of the Deal
It’s rare in modern M&A for all workers to be retained—and even rarer for that to be part of the deal’s public narrative. Diageo has framed this sale as part of its Environmental, Social, and Governance (ESG) responsibility 8, avoiding the negative press of closing the plant outright and leaving hundreds jobless in a region where those jobs matter.
That part? That’s worth noting. You don’t build brand trust just through marketing anymore. You build it through transparency and humanity, and Diageo—however clinical in its strategy—knows this.
A Wider Industry Trend
What’s happening in Italy isn’t isolated. It’s part of a broader pivot we’re seeing across beverage and CPG sectors:
- Big companies are shedding plants and focusing on brand stewardship.
- Mid-tier regional players are scaling up by absorbing these operations and flexing operational muscle.
- Consumers are gravitating toward premium, hyper-local, and story-driven brands, forcing multinational portfolios to thin and refocus.
In a post-COVID world where supply chains are unpredictable and asset overhead is a drag, the new power move is staying light, moving fast, and letting someone else do the bottling.
Final Pour
Diageo’s exit from Italy is not a retreat—it’s a redefinition. They’re not giving up territory. They’re giving up baggage. And in doing so, they’re positioning themselves to focus on what matters most: brand equity, global growth, and the margin-rich future of spirits.
NewPrinces gets a factory, a foothold, and a fresh chapter. Diageo gets freedom to double down where the real money lives. And for the 349 workers in Santa Vittoria, this deal means they still have a place to clock in Monday morning.
In an industry where “heritage” sells but agility wins, this move feels less like an ending—and more like a prototype for what’s next.
References:
Reuters. Newlat Food to buy plant in northern Italy from Britain’s Diageo. May 13, 2025.
Inside.beer. Newlat to Acquire Diageo’s Italian Beverage Plant. May 15, 2025.
Reuters. Diageo to sell Guinness Ghana stake to Castel for $81 mln. Jan 28, 2025.
The Drinks Business. Diageo to Close Chase Distillery. Mar 2025.
The Grocer. Diageo shelves Pimm’s sale after buyer interest fizzles. Apr 2025.
Diageo FY2024 Annual Report. Focus on Premiumization & Growth Markets. July 2024.
Beverage Daily. RTDs and no/low alcohol to dominate EU trends in 2025. Mar 2025.
Diageo Corporate Press Release. Diageo commits to responsible divestment in Italy. May 2025.
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