P diddy Ventures into Tequila Drinks

Diageo PLC (DGE.L) and celebrity rapper turnedbusiness mogul Sean "Diddy" Combs have jointly bought luxury U.S. tequila brand DeLeon, hoping to repeat the success they have had with the company's fast-growing Ciroc vodka.

The American record producer, actor and entrepreneur became the face of Ciroc in 2007 under a joint marketing and profit-sharing deal which has brought a near 40-fold rise in annual sales volumes for the brand's products.

"With Ciroc, we dated. Now with DeLeon, we're married," Combs said in an interview. "This deal is way better. This makes me aFinancial terms were not disclosed on Wednesday, but the purchase of the DeLeon brand takes Diageo an albeit tiny step towards replacing the sales and profit lost last year when it stopped selling Jose Cuervo, the world's top-selling tequila.

Diageo, the world's biggest distilled drinks company, let its distribution agreement with Cuervo's owner, the Beckmann family expire after failing to get an equity stake.

"For me, it's all about the profitability," said Diageo North America President Larry Schwartz, who told Reuters last year that his personal goal was to replace the profit from Cuervo within two years.

This week, he stood by that target, citing Combs's track record of success, the likelihood that Diageo will buy or launch another tequila, and DeLeon's high price. Combs's favourite version, the anejo, sells for about $200 per bottle.

"If we can get the accelerator on DeLeon like we had on Ciroc, two years is within reason," Schwartz said, adding that "this isn't going to be the last entry into tequila for Diageo going forward". Diageo also owns half of the Don Julio brand with the Beckmann family.