Exclusive: Gallo Acquires RumChata, Adding To Its Spirits StableApril 6, 2021
E.&J. Gallo has made another play to bolster its rapidly expanding spirits portfolio, agreeing to acquire Impact “Hot Brand” RumChata for an undisclosed sum.
Founded in 2009 by master blender Tom Maas, RumChata’s core offering is a 13.75% abv mix of dairy cream, rum, and a proprietary sweet spice blend, retailing at $22 a 750-ml. The lineup has since grown to include MiniChatas, 25-ml. cups for consumers wanting to add RumChata to their coffee; RumChata Cold Brew; and most recently RumChata Limón. It has also marketed successful seasonal editions like RumChata Peppermint Bark for the holiday season.
RumChata roared out of the gate, topping a half-million cases by 2015. In the ensuing years its progress flattened out some, but last year marked a renewed surge in which the brand jumped 16% to 550,000 cases, according to Impact Databank. Gallo believes there’s plenty of latent potential remaining in the franchise.
“There are significant geographies where the brand is still underdeveloped and has low awareness compared to the competitive set,” Britt West, Gallo’s vice president-general manager for spirits, tells SND. “At the same time there is room for size expansion to meet the different usage occasions of existing consumers. RumChata Limón and other limited time offerings are in their infancy and have relevance for both retail and on-premise channels.”
The acquisition includes Agave Loco LLC, which owns the RumChata brand, and Midwest Custom Bottling LLC (MCB), which produces RumChata at its facility in Pewaukee, Wisconsin. The Tippy Cow and Holly Nog brands owned by MCB are also included in the transaction, which is expected to close on April 16.
“We have taken the growth of the brand as far as possible as a small supplier, and it was the right time to find a new brand steward,” said Maas. “I know the RumChata brand will thrive under Gallo’s guidance.”
RumChata will join New Amsterdam Vodkas and Gins, Germain-Robin Brandy, High Noon Sun Sips Hard Seltzer, Pink Whitney, and Camarena Tequila in Gallo’s spirits stable. In addition to its own brands, the company handles luxury labels like The Dalmore Single Malt Scotch, Don Fulano Tequila, Diplomático Rum, and Amaro Montenegro in the U.S.—Daniel MarstellerSubscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning.