Bacardi is reportedly close to clinching a deal on Ilegal Mezcal, having bought a minority stake in the brand in 2017.

The deal would value the brand at less than $200m, unnamed sources told Bloomberg.

As a minority shareholder Bermuda-headquartered Bacardi has right of first refusal in any sale, they added.

Just Drinks has contacted Bacardi for comment.

The news follows speculation in February private-equity firm L Catterton was in discussions to snap up the brand. The firm was reportedly in “advanced” talks over an acquisition, Bloomberg said.

As well as Bacardi, Ilegal’s existing backers include US-based private-equity firm VMG Partners.

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Bacardi purchased its minority interest in the mezcal producer for an undisclosed in 2017 to expand its distribution footprint in the US. It signed a deal with Southern Glazer’s to be distributed through its transatlantic spirits division.

Ilegal, based in Brooklyn in New York, was founded in 2006 by John Rexer, who needed mezcal to stock his bar in Guatemala. He began by smuggling mezcals from several producers in Oaxaca, Mexico, before creating his own brand for the bar. The back label of each bottle has a note saying: ‘Originally produced for: Café No Sé, Mezcal Bar.’

Following the minority stake sale, the company has continued to operate independently under the direction of Rexer. It said at the time it would maintain its business structure and employee base.

The following year Bacardi also purchased Tequila powerhouse Patron, taking full control of the then-$5.1bn-valued business. It has since shifted the company’s focus, bidding farewell to its flagship Café expression in 2021 to focus on its Silver, Reposado and Anejo iterations.

Industry watchers believe mezcal has been able to capitalise on the growing consumer thirst for Tequila. The rise in demand for mezcal has sparked M&A interest in the category. Since 2017, Pernod Ricard has acquired Del MagueyDiageo has bought Mezcal Unión owner Casa UM and Campari Group has picked up Montelobos.

In October last year, Pernod Ricard bought a majority stake in Código 1530, a distiller making both Tequila and mezcal.