Australia's Treasury Wine Estates buys US, British assets

The world's largest listed vintner, Australia's Treasury Wine Estates, on Wednesday further boosted its reach by buying the American and British-based wine operations of drinks giant Diageo for $US600 million.

Treasury, which owns major brands including Penfolds, Rosemount Estate and Wolf Blass, will tap investors for Aus$486 million (US$350 million) to help fund the deal.

"The acquisition of Diageo Wine represents a highly compelling strategic and financial opportunity for TWE's shareholders," said Treasury chairman Paul Rayner.

"Diageo Wine's business is very aligned to our strategic roadmap and we expect that the acquisition will deliver long-term value creation to our global operations and to our shareholders."

Treasury, which was spun off from the Foster's beer business in 2011 and has assets on three continents with more than 80 brands, made a net profit of Aus$77.6 million in the year to June 30.

Diageo, a global drinks giant that owns brands including Johnnie Walker whisky and Smirnoff vodka, is a leading player in the US luxury wine market.