Grant's sets sights on tequila sunrise
Submitted by Tequila.net
January 27, 2007
WILLIAM Grant & Sons, the family-owned distiller and one of Scotland's biggest private companies, has expanded into the tequila market with a 30% stake in Mexican brand Milagro.
The maker of Glenfiddich, The Balvenie and Hendrick's Gin is keen to get a foothold in a category that although small is experiencing rapid growth at more than 7% per year.
Under the terms of the deal Grant's has retained an option to buy the brand out-right if it achieves its growth targets.
Roland van Bommel, chief executive of Bellshill-based Grant's, said that the acquisition was part of the firm's strategy to expand its portfolio in the premium sector.
He said: "Milagro is a very exciting prospect founded by two enthusiastic Mexican entrepreneurs. It is a super premium brand that sits at the top of the market. Going in as a partner makes sense as we can help grow the brand rather than buy an outright acquisition.
"We are planning a UK launch in the second half of this year. The price of a bottle has not been set yet but it will reflect the premium positioning of Milagro which sits at the top end of the category, where there is dynamic growth, particularly in the USA and increasingly in the UK."
Tequila is big business in the US, fuelling a global market worth 26m cases a year.
Latest results show that Grant's saw an 8.1% leap in pre-tax profits to £77.3m for the calendar year 2005. Turnover climbed to £352.6m, compared with £339.5m the year before.
Van Bommel added that Grant's had just experienced its "best ever year", increasing sales of its Glenfiddich brand to around 900,000 nine litre cases.
He also said sales of Hendrick's gin "are beginning to take off".
The gin, launched in the USA in 2001 and Europe in 2003, is already selling 100,000 cases annually.