It's nothing new for a celebrity to support a brand or start a company under their name, but George Clooney has just raised the bar.

The colossal $1bn price tag ($700m initial plus $300m earn out) for Clooney's Casamigos tequila brand, which he started on a whim with two friends, illustrates the phenomenal amounts companies are willing to pay for celebrity endorsement. But is it worth it? Casamigos' buyer, drinks behemoth Diageo, thinks it is.

No doubt Diageo will have done its homework and having Scotch Whiskey Haig Club in its portfolio gives it the perfect case study. The drinks giant will have been tracking sales of the Haig Club's more affordable spin off, Haig Club Clubman, since its launch in 2016, which used the heavyweight endorsement of David Beckham. They will have seen the returns from Beckham's association, which no doubt will have contributed to the willingness to pay such a large amount for the goodwill of Casamigos. 

Looking at this deal from an M&A perspective, the numbers are quite something. The estimated c.20x revenue multiple (pre-earn out) is colossal. To give a rough idea of just how much of a return this is, assuming an arbitrary 20% EBITDA margin on the reported $36m turnover would make the $700m price tag a 97x multiple.

And if we then include the additional $300m that could be paid on an earn out, the EBITDA multiple could be as much as 140x. If the actual numbers are even half of these fairly crude estimates, then this deal eclipses the multiples paid in a large number of tech deals, which are famous for returning double digit multiples - but not triple digit.

Although this deal is almost masked as a business acquisition, take Clooney out of the equation and there's no way Diageo would have paid as much. Using a generous multiple of say 8x would value a business with Casamigos' current track record at c.$58m. The $942m difference from this valuation and Diageo's $1bn shows that brand Clooney is in a pretty good place and that if the face fits, companies will pay big money.

Following the sale, Clooney has confirmed he's not going anywhere and why would he considering there's a further $100m in it for him? Clooney (who apparently charged a reported $40m for the Nespresso adverts in 2013) can be confident there's still a lot of value in few tequilas the night before and an espresso the morning after.