UK: Glenmorangie and Drambuie form joint venture

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Glenmorangie plc and The Drambuie Liqueur Company Ltd have formed a joint venture company called Glenaird Ltd to handle the two companies supply chain requirements.

Based at the Glenmorangie Broxburn site in West Lothian, Glenaird will handle all requirements from whisky sourcing to bottling, warehousing and logistics. Glenmorangie will also manage the new site.

Commenting on the Glenaird venture, spokesman for Drambuie Chris Lansdell told "Because the two companies are next door to each other it made a lot of sense to look at sharing a common supply chain. They are both fiercely independent family businesses and this gives them even more ability for them to remain fiercely independent family businesses.

"Distribution is not affected, neither is sales and marketing and there are no plans to look at those," he added.

Drambuie will eventually close its Kirkliston site at West Lothian, which employs around 100 staff. Lansdell said: "We don't know the implications on jobs at the moment. But while the Kirkliston site will be disposed of in due course, there will be some functions at that site that will transfer to the new site and remain under Drambuie control. There will also be new opportunities at the new site as it's an expanding facility," he said.

Operational from July this year, the new company is expected to have achieved full integration within 18 months. And the benefits of the joint venture said Glenmorangie, the number three premium malt brand in the world, will be somewhere in the region of £1m ($1.4m) in PBT (within a three year timescale).

Glenmorangie has denied any long term plans to extend the joint venture with Drambuie and in a statement said: "Glenaird will provide substantial benefits over time to Glenmorangie from the improved utilisation of the Broxburn facility and associated infrastructure, combined purchasing of both whisky and bottling materials and sharing of warehouse facilities."

Paul Neep, chief executive of Glenmorangie plc said: "We are delighted to be associated with Drambuie, a leading independent Scottish company with a strong international brand. The formation of Glenaird addresses one of our key strategic objectives - that of making best use of our assets."

He continued: "We believe this arrangement will deliver cost benefits for Glenmorangie from the financial year just commencing, allowing us to invest in further strengthening our leading malt brands."

Companies: LVMH Group

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