Diageo, the world's largest spirits company, said on Wednesday it had taken a majority stake in distilled non-alcoholic spirits brand Seedlip, as it looks to cater to a growing population of teetotalers.
The maker of Johnnie Walker whisky and Tanqueray gin bought a 20% stake in the maker of spice-based drinks in 2016 through its venture capital arm Distill Ventures.
Diageo uses Distill Ventures to invest in small brands that tap into emerging consumer tastes and trends. So far, the venture has invested more than 60 million pounds ($73 million) in about 15 drinks brands.
Shares of Diageo, which did not disclose the terms of the transaction, were up 1%.
Young Drinkers Abstain
The deal comes at a time a growing proportion of young drinkers in Great Britain claim to abstain from drinking alcohol. Teetotalism in Great Britain increased to 22% in 2017 from 19% in 2005 for those aged between 16 and 24 years, according to a 2018 report from the Office of National Statistics. That equates to about 10.2 million people.
Founded by Ben Branson, Seedlip has a presence in more than 25 countries, including the U.K., Australia and the United States and is sold in three spice variants. In the UK, Seedlip is sold at outlets including Selfridges, Waitrose, Sainsbury's and Tesco.
Branson will retain a minority shareholding in the company, Diageo said.