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Brown-Forman acquires BenRiach for £285m

Brown-Forman, the makers of Jack Daniel’s, has acquired the BenRiach Distillery Co., including its GlenDronach, BenRiach, and Glenglassaugh single malt Scotch distilleries, in a deal worth £285 million.

When completed, the deal will bring three single malt distilleries, a bottling plans and the company’s headquarters in Edinburgh under the control of Brown-Forman, but operating as a subsidiary of the US-based company.

“The acquisition of these super premium brands will allow Brown-Forman to re-enter one of our industry’s most exciting and consistent growth segments, Single Malt Scotch Whisky,” said Brown-Forman chief executive officer Paul Varga. “The GlenDronach, BenRiach, and Glenglassaugh single malt brands are rich in history and we believe they will continue to prosper and grow in our hands.”

Brown-Forman produces predominantly American whiskies, but has expanded into other categories in recent years. In June 2015, the group made its first foray into Irish whiskey with the acquisition of Slane Castle Irish Whiskey on the historic Slane Castle Estate in County Meath, Ireland for US$50 million. In January of this year, following months of speculation, Brown-Forman confirmed the sale of its Southern Comfort and Tuaca liqueur brands to rival US producer Sazerac for US$544m.

The company has now turned its attention to the single malt Scotch category, which has been showing strong growth in recent years, particularly in the US and Canada. While volumes of Scotch exports fell by 3% in the first half of 2015, exports of single malt whiskies increased by 5% in value to £406m.  

Brown-Forman had previously held a minority stake in Glenmorangie single malt Scotch, marketing the brand in the US, Canada, parts of Europe and Asia at various intervals, but sold its share to Moet Hennessy in 2005. The GlenDronach, BenRiach and Glenglassaugh brands will bring Brown-Forman’s back into the single malt Scotch category, and will join a portfolio that already includes Jack Daniel’s, Woodford Reserve, Herradura rum and Chambord.

The BenRiach distillery was first established in 1898, but was was closed after just two years of operation. In 2004, the business was acquired by three entrepreneurs – Billy Walker, Wayne Kieswetter and Geoff Bell – and The BenRiach Distillery Company was formed.

Located in Speyside, The BenRiach Distillery is known for experimenting with wood finishes producing whisky from both non-peated and peated malted barley. The company took over The GlenDronach Distillery in 2008. First founded in 1826, it is known for producing richly sherried, single malt whiskies. The company acquired Glenglassaugh, which is located in the northern Scottish highlands and produces a coastal Highland malt, in 2013.

“We feel immensely privileged to have been custodians of this business for the last 12 years, and to be associated with these wonderful brands and great distilleries,” said Billy Walker, managing director of The BenRiach Distillery Company Limited.

“Our team have energized these distilleries and engaged creatively and successfully with the premium end of the market. We are very confident that Brown-Forman will take The GlenDronach, BenRiach, and Glenglassaugh brands to the next level and fulfill their full potential, and prove to be worthy custodians of these historic distilleries.”

The deal is expected to complete around 1 June, 2016.

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