Diageo is in talks with Jose Cuervo to acquire the remaining 50% stake in Don Julio tequila, and in exchange offer its Bushmills whiskey assets.
The company currently owns 50% stake in Don Julio.
The take-over of the complete ownership of the premium brand in exchange for its Irish whiskey label Bushmills, will allow Diageo to bolster its presence in the tequila market.
In January, Diageo purchased tequila brand Peligroso from Peligroso Spirits Company, in a move to create a portfolio of variant quality tequilas.
Diageo planned to buy Jose Cuervo two years ago, but the talks ended as the companies did not agree on terms.
There was a distribution deal in place between the companies but that ended in 2013.
Don Julio, an upscale portfolio of tequilas, currently records about 25% increase in sales annually, reported The Wall Street Journal.
Diageo reported 7% growth in organic net sales of its Irish whiskey brand Bushmills during the fiscal year ended June, while its tequila sales increased by 34%.
Image: Jose Cuervo and Diageo currently have equal ownership in Don Julio. Photo: courtesy of WestportWiki.
