Constellation Brands Sells Canadian Wine Business, Buys U.S.-based Charles Smith Wines

Constellation Brands Inc. announced Monday a deal to sell its Canadian wine business to Ontario Teachers' Pension Plan for the U.S. dollar equivalent of about $784.5 million. Earlier this year, the spirits company said it was mulling an initial public offering of part of its Canadian wine business, so it could focus more on high-margin, high-growth brands, but decided to sell the entire business instead. The company expects to recognize net cash proceeds of about $571.3 million, after debt repayment, from the deal. Separately, Constellation said it agreed to a deal to buy Washington-based Charles Smith Wines for $120 million. The stock, which surged 1.5% in premarket trade, has run up 19% year to date through Friday, while the S&P 500 has gained 4.4%.