Canandaigua Brands Signs Definitive Agreement to Acquire Spirits Brands

Fairport, NY, February 22, 1999 -- Canandaigua Brands, Inc. (NASDAQ: CBRNA and CBRNB) announced today that on February 21, 1999, Canandaigua Brands and Diageo Inc. ("Diageo") entered into a definitive agreement under which Canandaigua Brands will purchase from Diageo several well known Canadian whisky brands, including Black Velvet, the number three Canadian whisky in the United States, production facilities located in Lethbridge, Alberta and Valleyfield, Quebec, bulk whisky inventories and other assets. Other principal brands to be acquired include Golden Wedding; OFC; Schenley OFC; MacNaughton; McMaster's; and Triple Crown. In addition, the transaction includes multi-year agreements with Diageo under which Canandaigua Brands will provide packaging and distilling services for various Diageo brands.

The purchase price is approximately $185.5 million. The purchase of the assets is expected to be financed with senior subordinated debt. The transaction is subject to satisfaction of customary closing conditions.

Net sales (gross sales less excise taxes and volume related discounts) and brand profit (earnings before selling, general and administrative expenses, interest and income taxes) before depreciation for the products sold under the brands to be acquired during the twelve months ended June 30, 1998 were $74.0 million and $34.6 million, respectively, on unit volume (in 9-liter case equivalents) of approximately 2.9 million cases.

Richard Sands, President and Chief Executive Officer of Canandaigua Brands, said, "We are very pleased to be acquiring these brands which will be produced, marketed and sold through Barton Incorporated. This acquisition is another step in our strategy of making acquisitions to grow our presence in the beverage alcohol industry and to improve economies of scale. The addition of these Canadian whisky brands will strengthen our position in the North American distilled spirits category, as well as round out our portfolio of brands and category participation."

Canandaigua Brands, Inc., headquartered in Fairport, New York, is a leading producer and marketer of beverage alcohol brands. As the second largest supplier of wine, the second largest importer of beer and the fourth largest supplier of distilled spirits, Canandaigua Brands is the largest single-source supplier of these products in the United States. Canandaigua Brands is also a leading provider of wine and cider, as well as the premier independent wholesaler of beverage alcohol products, in the United Kingdom.

Canandaigua Brands' portfolio includes the following key brands:

Beer: Corona Extra and Corona Light, Modelo Especial, Pacifico, Negra Modelo, St. Pauli Girl, Tsingtao, Peroni, Double Diamond, Tetley's English Ale and Point in the United States

Wine: Almaden, Inglenook, Richards Wild Irish Rose, Cook's, Arbor Mist, Paul Masson, Taylor, J. Roget, Manischewitz, Marcus James, Estate Cellars, Dunnewood, Vina Santa Carolina and Mystic Cliffs in the United States, and Stowells of Chelsea, QC, Stones and Concord in the United Kingdom Distilled Spirits: Barton, Fleischmann's, Paul Masson Grande Amber, Mr. Boston, Montezuma, Canadian LTD, Chi-Chi's, Ten High and Inver House in the United States Cider: Blackthorn, Olde English and Diamond White in the United Kingdom