Diageo has agreed to pay nearly CA$23 million (US$16.8m) to keep its Canadian whisky Crown Royal in Liquor Control Board of Ontario (LCBO) stores.
The agreement, which was announced on Friday (13 February), means Diageo will pay the province the settlement while pushing on with the closure of its facility in Amherstburg, Ontario.
In August 2025, Diageo announced plans to close its Crown Royal bottling facility. This set off months of back and forth with Ontario premier Doug Ford, who threatened to “hurt” the drinks maker and permanently pull Crown Royal products from LCBO stores.
Ford believes that Diageo will shift Crown Royal’s entire production from Canada to its new plant in Alabama, US.
Québec’s finance minister Eric Girard and Manitoba premier Wab Kinew urged Ford to reconsider the boycott, believing it would cost even more Canadian jobs.
The Ontario government said Diageo’s settlement will be used to boost the province’s economy and create new jobs.
The settlement will be divided, with CA$500,000 (US$367,000) put into Invest WindsorEssex for economic development with a focus on Amherstburg. Another CA$500,000 will be given to other community projects to support the town’s residents.
The biggest portion of the settlement, CA$11m (US$8m), will go to the purchase of grain neutral spirits manufactured by Greenfield Global in Johnstown, supporting local production in eastern Ontario.
The remaining money will go towards new ready-to-drink products, such as Crown Royal, Smirnoff and Captain Morgan canned beverages, through a Toronto-based co-packer; direct funding for organisations that support the growth and sustainability of Ontario’s agricultural sector; new packaging for pre-mixed beverages through a new co-manufacturer in Scarborough; and Ontario-based marketing and promotion.
Future investment in Ontario
Ford said: “By standing firm in our plan to protect Ontario workers, we’ve secured nearly CA$23m in investments that Ontario would not otherwise have seen.
“These investments will help keep Ontario workers on the job, strengthen provincial supply chains and support the local community in Amherstburg and the surrounding area.”
Ford’s office said the agreement “strengthens Ontario’s end-to-end beverage alcohol supply chain – from agriculture and manufacturing to packaging and distribution – while supporting long-term economic growth and resilience”.
The closure of the Amherstburg site will go ahead this month and will impact 200 jobs.
There were reports last year that several alcohol companies had shown interest in buying the plant, including a CA$28.5m offer, which Diageo rejected. Diageo claimed it had not received any appropriate offers.
The Spirits Business has reached out to Diageo and trade union Unifor for comment.
Peter Bethlenfalvy, finance minister for Ontario, added: “Ontario remains committed to protecting good jobs and ensuring that industries across the province continue to grow and thrive. This agreement with Diageo reflects the strength of our agri-food and manufacturing sectors, and the value of standing up for workers.
“By working collaboratively with industry, we are building a stronger, more resilient supply chain while ensuring that companies benefiting from Ontario’s marketplace invest back into our people and our communities.”
The fallout from US tariffs has seen Canada’s provinces take measures to remove US-made alcohol from their stores.
Nova Scotia, Manitoba and Québec have all looked to clear remaining inventories, with funds put towards charities and food banks.
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‘ The preceding article may include information circulated by third parties ’
‘ Some details of this article were extracted from the following source www.thespiritsbusiness.com ’
