On Wednesday, the international producer and marketer of beer, wine and spirits, Constellation Brands, announced that it would sell about 30 of its low-end wine and liquor brands to E & J Gallo Winery for US $1.7 billion.
With this operation, Corona beer maker seeks to focus on more profitable brands such as Corona and Modelo.
In February, the company said it was looking to sell some of its low-end wine brands, in order to focus on their profitable high-end segment which include their beer and cannabis products aimed at a younger demographic.
The agreement includes brands such as, Clos du Bois, Ravenswood and Mark West which are sold at US $11 per bottle.
The company expects the agreement to close at the end of the first quarter of fiscal year 2020.
Constellation, which is expected to report quarterly results on Thursday, retains a large number of brands including Robert Mondavi, Meiomi, and Kim Crawford.
In 2016, the company sold its Canadian wine business to the Ontario Teacher’s Pension Plan for approximately US $772 million.