Exclusive: Constellation, In Bidding War, Acquires High West Distillery For An Astounding Price We Estimate At Over $150 MillionOctober 4, 2016
Moët Hennessy and Pernod Ricard Kept Upping Their Bids, But To No Avail
Constellation Brands has emerged victorious in a spirited auction for Park City, Utah-based craft spirits player High West Distillery, outbidding the field to secure the deal, Shanken News Daily has learned.
Bill Newlands, president of Constellation’s Wine & Spirits Division, said the company was motivated by three main factors in doing this acquisition. First was High West’s strong growth potential, and second was its strength as a platform for expansion into niche, luxury brands. “The third factor was High West’s talent for innovation—that was a critical part of this deal,” said Newlands. “They’ve been as good as it gets in coming up with new and exciting product profiles.”
Newlands said Constellation plans to retain current High West chief executive officer John Esposito, along with the High West team. “Virtually all 200 of High West’s employee base will stay on, led by John,” Newlands added. “In addition to having John continue overseeing the High West business, we think he’s uniquely qualified to help us broaden our capabilities in high-end spirits, based on his extensive career in the business. So we’re excited not only for gaining High West, but also for gaining John.”
“With High West as the foundation, our intention is to add people and to add brands,” said Esposito. “Constellation has a well-deserved reputation for great brand-building, and I’m looking forward to working with them.”
High West first made its name as a non-distiller producer, acquiring whiskies from third-party distillers including MGP Ingredients in Indiana and Sazerac’s Barton 1792 distillery in Kentucky. Its core four brands are Rendezvous rye ($59.99 a 750-ml.), Double Rye ($34.99), American Prairie Bourbon ($34.99) and Campfire ($64.99), a blend of Bourbon, rye and peated Scotch. Under Esposito’s leadership, High West’s annual volume has risen to its current level of 70,000 cases projected this year, up from just 35,000 cases just two years ago, according to Impact Databank. Next year, the company is projecting volume of 95,000-100,000 cases.
Last year, High West opened a new distillery at Blue Sky Ranch in Wanship, Utah. The new facility has a capacity of 200,000 cases. High West currently has a national sales force of 15-20 people, created and led by Esposito, an industry veteran who has served as chief executive of Bacardi USA and Moët Hennessy USA. He heads up a High West team that includes former Stoli Group executive Tom Schlachtenhaufen as senior vice president of sales and E. & J. Gallo veteran Justin Lew as vice president of marketing.Subscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning.