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Aquisition supports Asia growth

Hillhouse backs MBO at Loch Lomond whisky group

Loch Lomond distiller

Loch Lomond distillery: change of ownership


 

A publicity-shy Asian hedge fund, Hillhouse Capital Management, is backing management at whisky producer Loch Lomond to acquire the business from Exponent Private Equity.

Since the original buyout of Loch Lomond from the Bulloch family in 2014, the company has invested significantly in growing its portfolio of brands, distillery and bottling infrastructure, global distribution platform, and management team. The business now generates about 70% of its revenue from more than 100 international markets, compared to less than 10% at acquisition.

Teaming up with Hillhouse offers a strong partner for the business to further develop its international presence, particularly in Asia where whisky has become increasingly popular in recent years, and a market where Hillhouse has deep knowledge and strong business relationships.

Hillhouse also brings to the partnership a strong track record of building long-term relationships with innovative consumer brands, such as Peet’s Coffee and Gimborn, in helping them expand their global presence and reputation. 

Loch Lomond has a rich heritage dating back to the early 19th century and is a leading international producer of malt, blended and grain whisky. Its key premium Scotch whisky brands include Loch Lomond – “The Spirit of the Open,” Glen Scotia, and Littlemill, the oldest licensed distillery in Scotland. It also produces the “High Commissioner” and Loch Lomond blended Scotch whiskies, as well as Glen’s Vodka, the No. 2 vodka brand in the UK market, and Ben Lomond, premium Scottish Gin.

The company’s production spans sites across Scotland. It operates its Loch Lomond malt and grain distilleries at Alexandria in Dunbartonshire, Glen Scotia distillery in Campbeltown, Argyll and has its own bottling plant in Catrine, Ayrshire.

Commenting on the sale, Colin Matthews, CEO of Loch Lomond Group, said, “Over the past five years we are proud to have transformed The Loch Lomond Group into a premium international spirits business with a strong focus on innovation and a portfolio of award-winning brands.

“We believe now is the right time to move forward into the next stage of our growth strategy as we look to innovate further, extend our portfolio of brands and continue to expand our international presence, particularly in Asia where Hillhouse has significant experience. 

“The team at Hillhouse have impressed us immensely, and we look forward to partnering with them as we embark on the next exciting stage of our journey. We share both their vision and dedication to premium consumer brands.”




Wei Cao, partner at Hillhouse Capital, commented, “Loch Lomond’s rich heritage in Scotch whisky gives the business a distinct advantage as they look to further build on their success across the world, especially in the increasingly discerning Asian spirits market. Hillhouse’s experienced operational team will work closely with Loch Lomond’s management to help it offer a premium consumer experience in international markets through channels like e-commerce and new retail.”

Mark Taylor, Partner at Exponent, said: “We are very proud to have partnered with Colin and his team at Loch Lomond over the last 5 years, demonstrating Exponent’s investment philosophy of backing unique companies with great management and huge untapped potential.  

“We are delighted with the successful sale to Hillhouse, and we believe they will be great partners for the business. We wish both the management team and Hillhouse every success for the future and look forward to seeing the company continue to prosper.”

Financial terms of the deal were not disclosed.

 



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