English wine producer Nyetimber plans to enter the whisky business with its acquisition of The Lakes Distillery in Cumbria. The deal, which values the distillery at £71 million, is expected to close later this year after Lakes shareholders vote to approve the offer.
The all-cash offer comes at a time when the distillery is losing money, having reported a loss of £1.3 million in its last fiscal year. However, The Spirits Business reports the distillery has shown a gain of 35% in sales during the first seven months of the current fiscal year.
The distillery needed to raise additional capital over the next three years to fund increased production and expand distribution internationally. In what board members described as a “tough market for raising capital,” they concluded that the Nyetimber offer made the most sense.
Nyetimber CEO Eric Heerema said in a statement “We believe that this potential acquisition represents an opportunity for us to expand our capabilities, drive exciting new growth and support The Lakes in delivering on its ambition to be a globally recognised spirits brand.”
WhiskyCast has requested interviews with the principals in the sale, and this story will be updated as necessary.