Hillhouse Capital to buy Loch Lomond whiskies

Hillhouse Capital Management said June 6 that it is buying Loch Lomond Group from Exponent Private Equity. Financial terms weren’t announced. Loch Lomond, of Scotland, is a whisky producer.


June 06, 2019 04:27 AM Eastern Daylight Time

ALEXANDRIA, Scotland–(BUSINESS WIRE)–Hillhouse Capital Management, a global investment firm with a focus on innovative businesses in growth industries, today announced that it is partnering with the management team from Loch Lomond, one of Scotland’s most historic and iconic whisky producers, to acquire Loch Lomond Group 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, versus 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. We believe that the strongest advantages in business are innovative and differentiated products and management teams, which is why we are so excited to help Loch Lomond realize the potential of its outstanding brands in huge new consumer markets, such as Asia.”

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.

About Loch Lomond Group

Loch Lomond Group is an international premium branded spirits business with global presence in over 120 countries. The company’s production spans sites across Scotland and is one of the few distillers to have a fully integrated production and supply capability with 2 distilleries at Alexandria in Dunbartonshire and on-site cooperage, Glen Scotia distillery in Campbeltown, Argyll and its own bottling plant in Catrine, Ayrshire.

Its multi award-winning portfolio of brands include Loch Lomond, Glen Scotia and Littlemill, recently discovered to be 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.

In 2018 the company signed a five-year partnership with The R&A for Loch Lomond Whiskies to become “The Spirit of The Open”. The period includes the playing of the landmark 150th Open in 2021 at St Andrews, the home of golf.

For further information visit Loch Lomond Whiskies on Twitter: @LochLomondMalts, Instagram: @lochlomondmalts Facebook: Loch Lomond Whiskies and at www.lochlomondwhiskies.com

About Hillhouse Capital

Hillhouse builds businesses that stand the test of time. We are long-term investors focused on partnering with world-class entrepreneurs to help them grow their businesses globally. Over more than a decade, we’ve worked alongside iconic companies that have redefined their industries. With offices in Hong Kong, New York, Beijing and Singapore, we look for opportunities around the globe, and have the flexibility to work across the private equity spectrum, from seed investments to buyouts. We manage capital on behalf of global institutions such as non-profit foundations and pensions, and we are proud that our efforts help support educational scholarships, scientific innovation, and artistic achievements across the world.

About Exponent

Established in 2004, Exponent is one of the UK’s leading private equity firms, investing in companies with enterprise values between £100m and £400m. The company seeks to identify untapped potential and navigate complexity to unlock growth for its portfolio companies and investors. Its current and former investments in consumer media and publishing businesses include the Times Educational Supplement, Immediate Media and the Racing Post. A selection of Exponent’s other investments includes Quorn Foods, Photobox Group, Big Bus Tours, the Ambassador Theatre Group and Trainline.