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Angostura Not Bitters

by Gavin D Smith, 10/08

The current dynamism within the Scotch whisky industry is well documented, but it is pleasing to see this trend reflected across the Atlantic in the USA, with the West Indies-based spirits company Angostura Ltd branching out into the American whiskey business

Angostura has acquired the former Seagram distillery at Lawrenceburg, Indiana and the Charles Medley distillery in Owensboro Kentucky, though to date it has been best known as a rum producer and for its 'Aromatic Bitters' drink, first developed in 1824.

The company is part of the CL Financial Group, one of the largest holding companies in the Caribbean. Its interests include spirits and beverages, food manufacturing, insurance, financial services, real estate, media and communication, forestry and agriculture, health services, energy and petrochemicals, manufacturing, trading, distribution and retail.

CL's existing whisky business consists of East Kilbride-based Burn Stewart Distillers Ltd, owners of Tobermory, Bunnahabhain and Deanston distilleries and the Scottish Leader blended Scotch whisky brand.
  

The Lawrenceburg distillery and bottling facility was purchased last year, and is now set to become Angustora's US headquarters. CL Financial chairman Lawrence A Duprey says "We're delighted to expand our presence in Lawrenceburg and elsewhere in the United States, and the establishment of a US headquarters is a first step to accomplishing that goal. With the Lawrenceburg acquisition we have the ability to provide a one-stop shop for the distillation, maturation, blending, bottling and packaging of alcoholic beverages in the white and brown spirit sectors."


   What is now known as the Angostura Distillery in Lawrenceburg is the largest spirits facility in the USA in terms of production capacity, responsible for 14 per cent of the country's domestically-distilled whiskey. The plant was acquired by Pernod-Ricard USA along with other Seagram assets in 2001, and following Pernod's subsequent acquisition of Allied Domecq in 2005 it became surplus to their requirements.

Pernod initially announced that it would close the plant, which would have meant the loss of more than 400 jobs, but its sale to Angostura Ltd has safeguarded around 150 of those posts. Assets included in the transaction include a 940,000 grain bushel storage capacity, 27.5 million USPG annual distillation capacity spanning, a maturing warehouse capacity in excess of 400,000 barrels, and a 196,000-square-foot bottling facility which has the capability to bottle 18 million cases annually.

Angostura is now the largest independent spirits producer in the USA, and the highest profile whiskey brand distilled at Lawrenceburg is Seagram's 7 Crown American Blended Whiskey. The plant also produces grain neutral spirit, gin, light whiskey, corn whiskey, rye whiskey and Bourbon.

Lawrence Duprey says that "We have engaged engineers and surveyors to inspect the operations of the plant and their indications are that it has been maintained and operated at a higher standard than most other distilleries in the US. This is a fitting tribute to the management team we have retained, led by plant manager Rick Brock, as well as the skills and training of the entire work force. The quality of our product is at the premium end of the industry.

"Our goals are to aggressively grow our presence in the US. An industry trend has been to divest of manufacturing capacity and concentrate on brand equity. We plan to lure business to Lawrenceburg and develop long-term relationships with companies wishing to acquire better quality and service for both distillate and packaging."

Proof of that growing presence came with Angostura's subsequent purchase of the Charles W Medley distillery in Owensboro, Kentucky, earlier this year for a reported sum of $3 million. The distillery had previously been family-owned for eight generations, but had been silent for 15 years until Angostura purchased the 25-acre site. Company representatives cite growth opportunities for Kentucky Bourbon in overseas markets, particularly in Europe and the Far East, as the principal reason behind the Charles W Medley acquisition.
  

"One of the gaps in our portfolio has been Kentucky Bourbon," says Lawrence Duprey. "Kentucky Bourbon is enjoying significant growth in Europe and the Far East. It's becoming a world brand."

Angostura is currently in the process of spending $25 million restoring and expanding the Medley facility, which is due to reopen later this year. It is anticipated that production capacity will be expanded from 1.5 million proof gallons to between 2.5 and 3 million gallons, and the new owners also intend to construct barrels on site for the first time in several decades.

As many as 20,000 barrels will be made each year, and the Bourbon produced in the distillery will be matured on site in these new, charred white oak barrels for four years. According to company sources, it will be sold under a new 'Charles Medley Kentucky Bourbon' label.

Nobody likes to see silent distilleries, so Angustora's involvement in both Indiana and Kentucky is a very positive step forward for the US whiskey industry, which has seen more than its fair share of distillery closures during the past few decades.
  

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