Diageo Expands RTD Portfolio with Acquisition of Loyal 9 Cocktails

Alcohol conglomerate Diageo is extending its reach into the ready-to-drink cocktails category with the acquisition of Loyal 9 Cocktails, makers of a line of vodka-based canned beverages, from Sons of Liberty Spirits Company.

The acquisition will be funded through Diageo’s existing cash resources. Terms of the deal were not disclosed.

Launched in 2018, Loyal 9 produces a line of vodka drinks containing 9% ABV and 15-20 grams of sugar per 12 oz. can. The brand’s core line is made with real fruit juice and is available in Apple Cider, Cranberry Lime, Lemonade, Lemonade + Iced Tea, Mixed Berry Lemonade and Watermelon Lemonade flavors. The company also makes a line of vodka seltzers with 4.5% ABV and sold in Lemon, Lime, Orange and Raspberry flavors. Sold in 4-packs, the drinks are available in New England retail stores.

“True to Loyal 9’s revolutionary roots, we created this brand to introduce something even better for our consumers,” said Sons of Liberty CEO Mike Reppucci in a press release. “It’s been a fantastic adventure to create and lead Loyal 9’s development to this stage, and we’re excited to be passing the baton to Diageo to take this great brand to the next level.”

Based in Rhode Island, Sons of Liberty Spirits Company produces bottled whiskey and gin, including the Uprising and Battle Cry single malt whiskey brands and True Born Gin.

The purchase reflects a growing interest in the ready-to-drink alcohol market and comes just one month after Diageo acquired Far West Spirits LLC, the maker of hard seltzer brand Lone River Ranch Water. The company has also tapped its existing spirits portfolio to innovate in-house, launching Crown Royal Ready to Drink Cocktails, Tanqueray Crafted Gin Cocktails and Ketel One Botanical Vodka Spritz.

“Loyal 9 hits an RTD ‘sweet spot’, merging American consumers’ growing appreciation for better quality ingredients with the full flavor lemonade they love, and a classic Americana feel,” said Debra Crew, president of Diageo North America, in a press release. “We have a clear strategy to build and diversify our RTD offerings across price points and consumer segments, and Loyal 9 is a great addition to our portfolio, which is also growing through the recent acquisition of Lone River and innovations from several of our brands.”

Ready-to-drink spirits, including hard seltzer, reported retail sales of over $7.8 billion in 2019, up 20% between 2016 and 2019 according to the company. According to NielsenIQ, RTD cocktails grew 79% to $664 million in 2020. Diageo has placed an increased focus on the category in recent years and said it plans to continue building its portfolio through innovation and potentially more M&A activity, including through Distill Ventures.

Last month, Diageo North America announced it would invest roughly $80 million into RTD manufacturing, including the installation of two can lines (one with a rate of 500 cans per minute and the other with a rate of 1,200) at a new 225,000 sq ft. facility in Plainfield, Illinois. The facility has the capacity to produce over 25 million cases per year and will begin production in the summer.