Distell and Terlato establish joint venture in US

South African spirits producer Distell Group is set to “substantially boost” the profile of its spirits brands in the US after establishing a joint venture with Terlato Wine Group.

Distell’s Steven Nathan believes the joint venture will ensure the group’s long-term growth in the US

The two companies have merged their spirits interest in the US to create Terlato Artisan Spirits division, in which both own an equitable 50/50 share.

The company, which will operate as an independent commercial division within Terlato Wine Group, will be led by Terlato CEO William Terlato in the interim until a permanent CEO is appointed.

Based in Chicago, Illinois, Terlato Artisan Spirits will begin trading from February 2016.

According to Steven Nathan, managing director of Distell International, the joint venture will both strengthen the presence of Distell and Terlato in the competitive US market and also ensure long-term growth.

“We are very excited by the development and believe that the new operation establishes us as an important and relevant USA player in the artisan spirits business and presents us with a great opportunity to grow,” he said.

William Terlato added that the move marked a “transformation” of Terlato’s spirits arm. “Distell brings a portfolio of world-class spirits brands that complement our own Terlato Artisan Spirits portfolio.”

The deal also involves an long-term agreement for Terlato Wine Group to import four of Distell’s South African wine brands – Nederburg, Durbanville Hills, Plaisir de Merle and Two Oceans.

Terlato Wine Group controls 20% of the wine segment retailing in the USA at US$20 and above, and is aiming to expand it specialty spirits offering. It already represents a number of spirits labels including Adelphi Scotch, Marnier Cognac, and Langley’s London No 8 Gin.

Distell owns brands including single malt Scotch whiskies Bunnahabhain, Tobermory, Ledaig and Deanston, blended Scotch whisky Black Bottle, Cognac brand Bisquit and South African labels Amarula liqueur and Bain’s Cape Mountain Whisky.

In October last year, Distell acquired 100% of Atlanta, Georgia-based distributor International Beverage Company (IBC) for an undisclosed sum.