Sonoma's Ravenswood is one of the wine brands included in the deal.

Photo by: John Curley

Sonoma’s Ravenswood is one of the wine brands included in the deal.

Wine giant E. & J. Gallo is purchasing approximately 30 wine and spirits brands from Constellation Brands for $1.7 billion, along with related facilities located in California, New York and Washington. The deal is still subject to regulatory approval and is expected to close next month.

According to Shanken News Daily, a sister publication of Wine Spectator, Constellation had been exploring selling its portfolio of labels retailing at $11 and below since last year. Clos du Bois, Black Box, Estancia, Mark West, Wild Horse, Franciscan and Ravenswood are among the wine brands included in the deal. Moving forward, Constellation plans to focus on premium brands including Robert Mondavi, Kim Crawford, Simi, Ruffino, Meiomi, Schrader and Mount Veeder.

“This decision will help enhance organizational focus on a more premium set of wine and spirits brands that better position our company,” said Constellation president and CEO Bill Newlands.

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Gallo sees potential to draw in new customers with lower-priced wines. “While we continue to invest in our premium and luxury businesses, we see a tremendous opportunity with this acquisition to bring new consumers into the wine category,” said Gallo CEO Joseph Gallo.

For more on the deal and its impact, visit Shanken News Daily.