Campari Group has struck an agreement to purchase an initial 70% interest in Kentucky bourbon and rye whiskey producer Wilderness Trail Distillery. It plans to purchase the remaining 30% in 2031.
Founded in 2012 as a premium craft distillery, the company was established by Shane Baker and Dr. Pat Heist, fermentation experts with more than 20 years of experience in the production of whiskey.
The pair, who are also current shareholders, launched two premium proprietary Wilderness Trail expressions in 2018: Wilderness Trail Bourbon and Wilderness Trail Rye Whiskey. The portfolio now also includes the high-end silver label six-year and eight-year bourbon line. The average retail price ranges from US$55 for the 75cl Wilderness Trail Bourbon to US$75+ for the six- and eight-year-old bourbon expressions.
Campari Group CEO Bob Kunze-Concewitz said: “We are very excited to take a controlling interest in world-class Wilderness Trail Distillery. By adding the fast-growing super-premium Wilderness Trail brand we further expand and premiumise our bourbon offering, priming it to become Campari Group’s second major leg after the aperitif portfolio.”
He added: “Moreover, we accelerate our premiumisation journey, further enriching our Rare portfolio, the division aimed to unlock and accelerate the growth potential of a select range of high-end individual expressions in our core premium spirits markets.
“In addition, we have the opportunity to significantly expand our production capacity and ageing inventory to satisfy the future growth of our premium bourbons, such as the high-potential Whiskey Barons range, currently capped due to capacity constraints. We are very excited to partner with such a strong team of industry pioneers and distilling experts allowing us to accelerate and significantly expand the innovation platform for our bourbon portfolio.”
Wilderness Trail Distillery Co-Founder Shane Baker said: “We are thrilled about our partnership with Campari Group. Premium bourbon and rye whiskies and state-of-the art production facilities coupled with worldwide distribution, first class marketing and expertise across multiple spirit categories provide the perfect foundation for the continued success of the Wilderness Trail brand and ensure it will be enjoyed around the world for years to come. This is a win-win situation for both parties and we are very proud of this partnership and what we can achieve together with our shared vision.”
This latest acquisition is an expansion of Campari Group’s bourbon portfolio, which began in 2009 with the acquisition of the Wild Turkey brand and distillery. Since then, Campari Group has relentlessly focused on the “premiumisation journey” of the Wild Turkey franchise, featuring also the upgrade and growth acceleration of craft bourbon Russell’s Reserve and the launch of small-batch bourbon Longbranch (in 2018) in partnership with actor Matthew McConaughey.
It also launched its ultra-premium Whiskey Barons Collection, including Old Ripy, Bond&Lillard and William Butler Saffell in 2017. In August 2022, Campari acquired an initial minority interest with path to control in Howler Head, a Kentucky Straight Bourbon Whiskey with Natural Banana Flavour, together with exclusive global distribution rights.
American whiskey is currently among the hottest spirits category in the US market, leveraging the positive trend across brown spirits, premium classic cocktail revival and mixology. It accounted for 13% of the total US spirits markets in 2021 in value terms, showing a growth of +7% versus the previous year with the super-premium price segment outperforming at +17%.
For the fiscal year ended on 31 December 2021, the acquired business achieved overall net sales of US$40.8 million, including net sales from Wilderness Trail Distillery bourbon and rye brand of US$7.2 million. The balance was generated by bulk sales as well as storage fees and a visitor centre, with EBITDA of US$22.7 million (US GAAP).
For the fiscal year ending on 31 December 2022, the acquired business is expected to generate overall sales of around US$57 million, an increase of +39% versus the previous year, with an increasing weight of the higher margin business generated by the Wilderness Trail bourbon and rye brand versus bulk sales, and an EBITDA of US$37 million under local GAAP (an increase of around +64% versus the previous year).
The transaction, which is subject to customary closing conditions, is expected to close before the end of the 2022 calendar year. Until the transaction closes each company will continue to operate independently.
