High West Distillery sold for $160 million
October 5, 2016
High West Distillery, the whiskey maker whose spirits have flowed from Old Town to the shelves of liquor stores around the world, is being sold for $160 million.
Constellation Brands, a Victor, New York-based Fortune 500 beverage company, announced the acquisition on Wednesday. The deal includes all of High West's operations and its portfolio of four primary whiskeys and several limited-edition spirits.
David Perkins, who founded the distillery in 2004, said the property High West owns at 703 Park Ave., where it operates a saloon and distillery, is included in the agreement, as is The Nelson Cottage by High West, a restaurant at 651 Park Ave. Constellation Brands will also take over the lease to High West's 30,000-square-foot distillery and tasting room in Wanship.
A press release notes that the distillery has posted double-digit year-over-year volume growth for the past three years and sells about 70,000 cases of whiskey annually. The transaction is expected to close by the end of October, the release states.
Perkins said the deal ensures a bright future for the distillery. Being part of Constellation Brands' portfolio will allow High West to build on the growth that has seen it become a major player in the high-end craft spirit industry, he said. For instance, the company will provide the resources for High West to expand operations at its Wanship distillery, where there is space for four whiskey stills. One still is in use now.
"Whiskey is a wicked-hard business just because of the investment," he said. "We knew for the long-term, if we partnered up, we'd maintain our leadership (in the industry). That will help us expand our plant and invest in the whiskey we're making. It would have been a long, tough slog for us to go it on our own."
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Perkins said there are no plans to make any changes, either at the saloon on Park Avenue or at the Wanship distillery, that would affect the customer experience.
"We wouldn't have even been interested in talking to (Constellation Brands) if that was the case," he said.
Additionally, he said he anticipates High West will remain in Park City for years.
High West's employees will join Constellation Brands and will continue making the whiskey. Perkins will remain involved in High West as its self-described chief ambassador, a role he's been transitioning to in recent years, he said. John Esposito, the distillery's CEO and a former executive at companies such as Bacardi Limited, will continue running day-to-day operations.
Bill Newlands, president of Constellation Brands' wine and spirits division, said in the release the company sees High West as a purveyor of "artfully crafted" whiskeys that will provide value to its brand. The acquisition allows Constellation Brands to enter the high-end whiskey market.
"With the addition of High West, Constellation Brands bolsters its position in the dynamic and growing craft spirits category," he said. "We look forward to welcoming this creative and talented team to Constellation Brands as we work together to drive growth for High West and build our premium spirits portfolio with brands that consumers love."
Perkins said Constellation Brands' commitment to premium beverages was enticing. It was important, he said, to sell High West to a company that pledged to continue to provide high-end products.
"The main thing is their commitment to premium," he said. "The last few years, they've divested some of their less-than-premium brands, and they've really done a lot on the premium space in terms of beer and wine. And they're committed to premium spirits and saw us as that platform."
Other names under the Constellation Brands umbrella include Corona Extra, Modelo Especial, Pacifico and Robert Mondavi.
The $160 million price attached to the High West acquisition is significant in a community with few transactions that reach into the nine figures. Vail Resorts in 2014 paid $182.5 million to acquire Park City Mountain Resort, as an example.