Two of the world’s leading spirits companies, Edrington and Beam Suntory, have agreed to an equity swap of stakes in their jointly owned distribution companies in the UK and Spain. Edrington, the ultra-premium spirits company, is to take full ownership of Edrington-Beam Suntory UK, and Beam Suntory, a world leader in premium spirits, will assume full ownership of Maxxium Spain. The agreement will take effect from 2 August 2021, subject to regulatory approval.
Both distribution companies will continue to distribute their current portfolios of Beam Suntory and Edrington brands.
After more than a decade of successful partnership across several markets, both companies agree that this is the right time to transition their distribution businesses in Spain and the UK from a joint venture structure to a fully owned structure. This will allow both businesses to reduce complexity, improve agility, make decisive investments and expand opportunities for employees as both businesses become part of larger international companies.
From August, Edrington-Beam Suntory UK will become Edrington UK Distribution Ltd, known as Edrington UK. Under current MD Mark Riley, Edrington UK’s 210 employees will work closely with their colleagues at Edrington’s global headquarters – also in Glasgow – to accelerate Edrington’s ultra-premium strategy, particularly in London, which is part of Edrington’s global key city strategy for The Macallan, Highland Park and Brugal. The two companies already work closely on skills and people development, and the closer relationship is expected to unlock new opportunities for employees of both businesses. Following completion of the deal, Edrington will employ over 1200 people in the UK, mainly in Scotland, with 35 people based in London.
Following this change, Edrington and Beam Suntory will maintain their strong partnership, with distribution agreements across several global markets, which will now include Spain and the UK. Both companies will also continue to maintain equal stakes in their remaining JV distribution business, Maxxium Russia.
Huw Pennell, Edrington’s Regional Managing Director for Europe, said: “Edrington has a portfolio of ultra-premium brands, led by The Macallan, the world’s most valuable single malt Scotch Whisky. As our business sharpens its focus on the rapidly growing opportunities for ultra-premium and prestige spirits, we are excited by the potential to work more closely with the talented Edrington-Beam Suntory UK team to accelerate this strategy while continuing to strengthen our presence of The Famous Grouse in our home market.
“Spain is a priority investment market for Edrington, and we are particularly pleased that this agreement will enable us to continue to work closely with the excellent Maxxium Spain team in Madrid to accelerate the growth of The Macallan in the key cities of Madrid and Barcelona and particularly Brugal rum in its No 1 international market.”
This will be the first time that Beam Suntory will have full ownership of its route to market in Spain, and it plans to invest in Maxxium Spain’s accelerated growth and in building its portfolio of premium brands, which includes Jim Beam and Roku gin. For Beam Suntory, Spain is a strategic hub and the home of its international headquarters, with corporate offices in Madrid and Jerez. Beam Suntory’s Segovia distillery also produces renowned Spanish brands, Larios, Whisky DYC, and Anís Castellana. By assuming full ownership of Maxxium Spain, Beam Suntory will further expand its commitment to the Spanish market.
Pryce Greenow, President International & Global Sales Excellence Officer, Beam Suntory commented: “We are delighted to welcome Maxxium Spain into Beam Suntory’s global business, after many years of partnership. We’re looking forward to establishing our first Route to Market in Spain, and we will be proud to employ more than 600 people across the country as a combined business. We also have big ambitions for our portfolio of premium brands, which includes Jim Beam, Larios and DYC. We plan to invest in our people, capabilities and brands to achieve sustainable, long term growth in Spain.
“The UK remains vitally important for Beam Suntory, and we look forward to continuing our close relationship with Edrington-Beam Suntory UK as our trusted distributor partner. The UK will always be a priority growth market for us, and London will continue to play a critical role as a global centre of luxury for our premium portfolio, including Maker’s Mark and Sipsmith.”