A Reuters report indicates that Diageo’s partnership with LVMH’s Moet Hennessy is facing significant challenges. The alliance currently delivers shrinking returns and creates operational friction.
These issues complicate efforts by new CEO Dave Lewis to revitalize the world’s largest spirits company. While investors focus on immediate performance, the future of the Moet Hennessy alliance remains a major long-term concern.
Unwinding the partnership would be complex and potentially expensive. Selling the stake back to Moet Hennessy would involve a 20% discount to its fair value.
The fair value of the stake reached approximately €4.3 billion in 2025. Past distribution strategy disputes in France have already led to costly terminations for Diageo.