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Quorn Owner Acquires Taste For Whisky Deal

(c) Sky News 2013

The investment group which owns the meat-free food range Quorn is in talks to take control of one of Britain's biggest independent whisky distillers.

I understand that Exponent Private Equity is the mystery party which has been holding discussions about a takeover of the Loch Lomond Distillery Company.

A deal would value Loch Lomond at tens of millions of pounds, although the exact price tag is unclear.

Exponent (NasdaqGS: EXPO - news) is understood to be the front-runner to acquire Loch Lomond, although other prospective buyers are also in the frame, according to people familiar with the situation.

Sky News reported the potential takeover of Loch Lomond in February.

Exponent, which may acquire Loch Lomond as part of a wider consortium of investors, bought Quorn Foods in 2011, and has broad exposure to other consumer-facing companies.

The private equity group is also a shareholder in Ambassador Theatre Group, HSS, the tool-hire company, and Radley, the premium handbag manufacturer.

If a deal is agreed, it would end the independence of one of Scotland's oldest whisky producers. The family of Sandy Bulloch, Loch Lomond's current chairman, traces its interest in the industry back to 1842, when Gabriel Bulloch partnered JH Dewar in a Scotch wholesaling business in Glasgow, according to the company's website.

Loch Lomond branched out into retail outlets as well as becoming one of the largest independent bottlers of spirits in Scotland. It owns the Glen's vodka brand, which it says is the second-biggest seller in the UK, as well as a bottling plant called Glen Catrine Bonded Warehouse Company.

Media reports last year said that the company recorded a modest rise in turnover from £17.83m to £18.3m in the year to March 31, 2011.

Accounts filed at Companies House show that Loch Lomond made a pre-tax loss of nearly £200,000 during the following 12-month period, with which directors said they were "happy" despite "a demanding year".

Among the claims that Loch Lomond makes about itself is that it is the second-largest family-owned distillery in Scotland and that it is the only distillery in Scotland that produces both grain and malt whisky on the same site.

Its average annual production is 10 million litres of grain alcohol and 2.5 million litres of malt alcohol, the equivalent of 43 million standard bottles of whisky every year.

Loch Lomond is one of the few prominent whisky producers not to count itself among the members of the industry body, the Scotch Whisky Association.

Exponent declined to comment.

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