Diageo-funded spirits innovation company Distill Ventures has acquired a minor stake in Seedlip, a UK-based non-alcoholic sprit brand.

Financial details of the deal have not been disclosed by the companies.

This is the first time that Distill has invested in a non-alcoholic company. Seedlip is used as an alternative base spirit for making cocktails in UK.

"The initial investment agreement foreshadows the mechanism about how the acquisition will happen."

Seedlip was founded by UK-based entrepreneur Ben Branson, and released its first product last year. The company launched its second product in May.

Branson was quoted by Just-drinks.com as saying: "I want to make sure we have as good a chance to make it as possible, and that we have the resources to be successful in this project.

Distill Ventures co-founder Frank Lampen was quoted by the website as saying: "The initial investment agreement foreshadows the mechanism about how the acquisition will happen.

"We agree with the entrepreneur a target, usually a volume target. If you can reach X thousand of cases a year then that triggers Diageo’s ability to buy it."