STZ Constellation Brands Inc

Constellation Brands Inc. said Monday it has agreed to sell its Canadian wine business to Ontario Teachers' Pension Plan for about $1.03 billion Canadian dollars ($784 million), underscoring Constellation's sharpened focus on premium spirits, beer and wine.

The news confirms a report by The Wall Street Journal on Sunday, which said Constellation was close to a deal to sell the business for C$1 billion.

Also on Monday, Constellation said it would buy the Charles Smith Wines collection for about $120 million. The transaction, expected to close in October, also highlights Constellation's pivot to higher-quality libations.

Victor, N.Y.-based Constellation said in April it planned to explore an initial public offering for its Canadian wine business. But it decided to put the business up for sale after receiving overtures from a handful of Canadian wineries and the teachers' pension plan, The Journal reported.

Chief Executive Rob Sands said in prepared remarks Monday that the company decided to sell the business when the opportunity "presented itself."

Constellation is jettisoning its Canadian unit, which includes such wine labels as Jackson-Triggs and Sumac Ridge, 10 years after it acquired Vincor International Inc. for C$1.27 billion. But it is keeping Vincor's international wine labels, including Australia's Kim Crawford, that came with the 2006 purchase.

Constellation shares rose 1.5% to $172 in premarket trading. The stock is up 25% over the past 12 months.

Write to Joshua Jamerson at joshua.jamerson@wsj.com

(END) Dow Jones Newswires

October 17, 2016 09:25 ET (13:25 GMT)

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