Diageo North America and Southern Wine & Spirits of America Announce New National Broker Relationship for Control States

After Extensive Review Process, Diageo Names a Single National Broker for Spirits and Wine Brands in Control States

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Jun 17, 2011, 09:07 ET

NORWALK, Conn., June 17, 2011 /PRNewswire/ -- Diageo, the world's leading spirits, wine and beer company, and Southern Wine & Spirits of America, Inc. (Southern), the nation's largest wine and spirits distributor, today announced agreements that appoint Southern Wine and Spirits the new National Broker for Diageo wine and spirits in control states. This announcement comes after an extensive review period initiated by Diageo earlier this year. The new relationship is an important milestone in the evolution of Diageo's route to market strategy.

Southern will provide fully dedicated coverage for Diageo spirits brands across all 18 Control States and will also represent Diageo's Chateau & Estate Wines portfolio in the five Control States for wine.

"I am excited about our new national relationship with Southern Wine & Spirits, which begins the next phase of Diageo's route to market strategy and is a key step toward driving a national sales force approach with our distributors and brokers in North America," said Larry Schwartz, President Diageo USA. "Diageo and Southern have a long history of proven results, and I look forward to building on this success. With these new agreements, I know Southern will provide clear leadership and increased resources in support of Diageo spirits and wine brands across the Control State platform. I would like to thank our existing brokers for their dedication and support over the years, as well as everyone that participated in this process."

The new agreements will go into effect on July 1 or August 1, depending on the state, and will provide for a number of key changes. These will include enhancements to the teams representing Diageo brands as well as increased focus on multicultural and on-premise—two areas that are designated as key priorities for future growth.

"In addition to Southern's existing exclusive representation of Diageo's spirits portfolio in six open states, we are thrilled with Diageo's appointment of us as their exclusive, national control state broker," added Wayne E. Chaplin, Southern's President & COO. "This appointment expands on our already extensive brokerage relationship with Diageo, and we look forward to working closely with Diageo to grow their portfolio of leading brands across all control states."

With the new agreements, Southern will expand its current 11 state relationship to 18, having exclusive rights to represent Diageo spirits brands in Alabama, Idaho, Iowa, Maine, Michigan, Mississippi, Montana, New Hampshire, North Carolina, Ohio, Oregon, Pennsylvania, Utah, Vermont, Virginia, Washington, West Virginia and Wyoming. As a result of the agreement in Pennsylvania, Diageo will move from self-representing its brands in Pennsylvania to a brokerage for wine and spirits.

States included for the wine brands are Mississippi, New Hampshire, Pennsylvania, Utah and Wyoming. The agreements do not include Montgomery County or Worcester County, Maryland, as those counties are covered by Diageo's current Maryland distributor. In addition, the agreements do not include Low Proof spirits in Idaho, Michigan or Ohio, or the Authorized Distributing Agent in Michigan.

Note to Editors

In 2000, Diageo embarked on a transformational route to market strategy for its spirits and wine brands in the U.S. The company is initiating the next phase in this strategy, with recently announced initiatives to enhance distributor relationships in key regions, in addition to the move to a single national Control States broker.

About Diageo

Diageo (Dee-AH-Gee-O) is the world's leading premium drinks business with an outstanding collection of beverage alcohol brands across spirits, beer and wine. These brands include Johnnie Walker, Crown Royal, J&B, Windsor, Buchanan's and Bushmills whiskies, Smirnoff, Ciroc and Ketel One vodkas, Baileys, Captain Morgan, Jose Cuervo, Tanqueray and Guinness.

Diageo is a global company, with its products sold in more than 180 countries around the world. The company is listed on both the New York Stock Exchange (DEO) and the London Stock Exchange (DGE). For more information about Diageo, its people, brands, and performance, visit us at Diageo.com. For our global resource that promotes responsible drinking through the sharing of best practice tools, information and initiatives, visit DRINKiQ.com.

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About Southern Wine & Spirits of America, Inc.

Southern Wine & Spirits of America, Inc. is the nation's largest wine and spirits distributor and broker with operations in 33 markets. The multi-state distributor currently operates in: Alabama, Arizona, California, Colorado, Delaware, Florida, Kentucky, Hawaii, Illinois, Indiana, Maine, Minnesota, Mississippi, New Hampshire, Nevada, New Mexico, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Vermont, Virginia and West Virginia—as well as the additional seven states of Alaska, Washington, Oregon, Idaho, Montana, Wyoming and Utah through the Southern-Odom/Spirits West partnership. In addition, Southern has a presence in Maryland and the District of Columbia through a joint venture with F.P. Winner Wine & Spirits as well as a joint venture operation in Minnesota with J.J. Taylor Distributing Company. Southern also holds operating licenses and permits in Nebraska and Texas, and will be entering the states of Iowa and Michigan as part of the national Diageo brokerage agreement. On a national basis, Southern Wine & Spirits of America, Inc. employs more than 11,000 team members. For more information, see: http://www.southernwine.com.