The spirits division of E & J Gallo Winery (Gallo) has finalised an agreement to acquire Agave Loco, owner of cream liqueur brand RumChata.

According to the agreement, Gallo’s spirits division will acquire Agave Loco and Midwest Custom Bottling (MCB), which produces RumChata at its facility in Pewaukee, Wisconsin, US.

The deal also includes Tippy Cow and Holly Nog brands, owned by MCB.

The financial details of the deal have not been disclosed.

Gallo spirits business vice-president and general manager Britt West said: “We see tremendous potential with this acquisition to further innovate in the premium spirits space with unique consumer propositions while continuing to add value to our wholesaler and customer partners.

“Opportunities like this are rare in the spirits industry and we are excited to add RumChata to our expanding portfolio of noteworthy brands.

“We look forward to continuing to build brand awareness for RumChata while expanding its availability both in the US and internationally.”

Inspired by the traditional milky rice drink from Mexico, RumChata was first created in 2009 using fresh dairy cream, rum and a proprietary sweet spice blend by founder and master blender Tom Maas.

Maas said: “First of all, I want to thank the distributors and retailers, as well as our employees, who supported RumChata since its inception. Your backing of the brand meant the world to us and will not be forgotten.

“As a small independent producer, we never imagined the success of RumChata when we were just getting started back in 2009. We have taken the growth of the brand as far as possible as a small supplier and it was the right time to find a new brand steward.

“I know the RumChata brand will thrive under Gallo’s guidance, and I am excited to watch the brand continue to grow and evolve in the future.”

The sale is expected to close on 16 April 2021.

In January, E & J Gallo Winery (Gallo) finalised the acquisition of more than 30 wine brands from Constellation Brands in a deal worth around $810m.