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Scotch Whisky Player Whyte & Mackay May Soon Be Up For Sale

April 11, 2012

As whisk(e)y continues to gain momentum in the global drinks market, Whyte & Mackay—one of the world’s most storied Scotch whisky producers—may soon be on the block. While Vijay Mallya, owner of Whyte & Mackay parent company UB Group, said in recent weeks that he had no plans to dispose of any businesses to reduce debt, UB executives are now exploring at least a partial sale of W&M, according to local reports.

When UB Group’s United Spirits Ltd. acquired W&M for approximately $1.2 billion in 2007, Mallya cited the company’s considerable Scotch whisky inventory and the potential of brands like flagship Whyte & Mackay Scotch whisky and Isle of Jura and Dalmore single malt Scotch whiskies, as well as Vladivar vodka. Soon after the deal, W&M moved to deemphasize the bulk and private label trade that had long comprised the majority of its business (Diageo was a major client, among others), and its leading brands have yet to take off. W&M’s sales and profits each fell by more than 50% for the fiscal year ending March 31, 2011. The unit’s branded business grew by 18% to 1.8 million cases in calendar 2011, but W&M’s larger struggles continue.

While W&M’s performance in emerging markets such as India and China may not have been as strong in recent years as Mallya and United Spirits anticipated, the company recently sharpened its focus on the U.S. market. Earlier this year, W&M formed an import company—Whyte & Mackay Americas—to handle its portfolio in the U.S. market.

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