Diageo said to be planning sale of wine brands

Brewer Diageo is reportedly in talks about a sale of its wine brands as it responds to City pressure to improve its performance.

According to Sky News, Diageo has in recent weeks accelerated plans to offload a portfolio including Blossom Hill and Piat d’Or, with Australian wine producer Treasury Wine Estates in the frame to acquire the brands.

Sky cited sources as saying that a deal could be announced by Diageo in October, although they warned that a transaction had not yet been signed with Treasury and that it could still fall through.

Since the company began sounding out potential bidders earlier in the year, several other parties have expressed interest in buying the business.

A Diageo spokesman told Sky News on Wednesday: "Wine is a small part of our business but it plays an important role.

"We have no other comment to make."

At 1208 BST, Diageo shares were up 2.7% at 1,763.51p.