Louisville-based Brown-Forman, the parent of Jack Daniel’s Tennessee Whiskey and Woodford Reserve premium bourbon, announced Wednesday that it was diving deep into Scotch.
Brown-Forman has agreed to pay $416 million for The BenRiach Distillery Co., including three malt distilleries, a bottling plant and the company headquarters in Edinburgh, Scotland. The transaction is expected to close about June 1.
This will give Brown-Forman three brands in the booming single-malt Scotch category: The GlenDronach, BenRiach and Glenglassaugh. Single-malt sales in the United States have been rising, up 13 percent by volume in 2015, to more than 2.1 million cases, with the biggest growth in the premium category. According to the Distilled Spirits Council of the United States, single-malt Scotch sales, measured by volume, have grown by 182 percent since 2002.
“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 Paul Varga, CEO of Brown-Forman. “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.”
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Brown-Forman was a minority shareholder in and marketer of Glenmorangie but sold its interest as part of Glenmorangie’s sale to Moët Hennessy in 2005, leaving Brown-Forman without a Scotch in its whiskey portfolio, which includes Old Forester and Early Times bourbons, and Canadian whiskeys Collingwood and Canadian Mist.
Last month, Brown-Forman announced that its first new bourbon in 20 years, Coopers’ Craft, would hit shelves this summer.
“Single malt is one of the healthier categories in spirits, and we had an eye to get back into it,” said Lawson Whiting, chief brands and strategy officer for Brown-Forman. “Within the world of single malt, there are very few really good assets even available.”
The BenRiach Distillery Co. was named 2015 Distiller of the Year by Whisky Magazine, he said. And the brands “are very premium,” Whiting said, selling at $50 or more per bottle.
That will work well with Brown-Forman’s strategy of emphasizing the ultra-premium side of the business, he said. Although the brands already are in about 60 countries, in small quantities, Brown-Forman will use its global footprint to expand distribution as inventory allows.
“We hope to compete with the biggest brands in the world,” Whiting said. “A lot of single malts have very long age statements ... we have some other ideas of things we can do to grow.”
GlenDronach and BenRiach already do a variety of experimental releases and wood finishes.
“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,” Billy Walker, managing director of The BenRiach Distillery Co., said in the news release.
According to the announcement, The BenRiach Distillery Co., which employs 165, including 55 seasonal and casual workers, will operate as a subsidiary of Brown-Forman.
The GlenDronach Distillery, in the hills of the Scottish Highlands, was founded in 1826. GlenDronach produces a range of ultra-premium single-malt whiskies and is most noted for its richly sherried whiskies, according to the news release.
Located in the heart of Speyside, The BenRiach Distillery began making malt whisky in 1898 and is known for experimenting with wood finishes, producing whisky from non-peated and peated malted barley. The Glenglassaugh Distillery, founded in 1875 on the coast in the northern Scottish Highlands overlooking the North Sea, produces a coastal Highland malt.
The purchase in Scotland comes less than a year after Brown-Forman announced plans to build a $50 million distillery at Slane Castle in Ireland to produce Irish whiskey. Slane Distillery is scheduled to open this year and produce 600,000 cases a year. The first Slane Irish whiskeys will be launched to market in early 2017, according to the company.
In January, Brown-Forman sold its Southern Comfort and Tuaca brands to Sazerac for $543.5 million to focus on core whiskey brands. In addition to the Jack Daniel’s family of brands, Brown-Forman owns Herradura and El Jimador tequilas, Finlandia vodka, Chambord liqueur, Korbel champagne and Sonoma-Cutrer wines.