LONDON: Nyetimber Wines and Spirits Group Limited has proposed a cash offer to acquire The Lakes Distillery Company plc, valuing the latter’s share capital at approximately £46.1 million.

Shareholders of The Lakes Distillery are to receive 116 pence per share, with the total enterprise value estimated at £71.0 million, accounting for The Lakes’ net financial debt.

The acquisition is subject to a court-sanctioned scheme of arrangement, with provisions allowing Nyetimber to adjust the offer based on any dividends or returns issued by The Lakes Distillery before the deal’s completion.

Nyetimber Wines and Spirits Group believes that The Lakes is the leading English distiller of premium quality Single Malt Whisky and other premium spirits, differentiated by its characteristic Sherry-led house style, wood forward approach and depth of flavour.

Having significantly expanded capacity over the last few years, Nyetimber Wines and Spirits Group believes that there is a sizeable opportunity for The Lakes Distillery to grow its market share within the UK Single Malt Whisky market, as well as to continue to expand its presence internationally, where Nyetimber is of the view that the quality and profile of The Lakes’ products and English provenance will resonate well with consumers.

Nyetimber believes that it is the right long-term partner to support The Lakes’ management team to deliver on its ambitions to become a leading international spirits brand, with the acquisition of The Lakes Distillery marking an important next step in Nyetimber’s plan to create a globally relevant, English luxury drinks group.

Commenting on the Acquisition, James Pennefather (CEO of The Lakes) said: “The Lakes Distillery Board is enthusiastic about its ambitious new ten year plan to achieve a 1 per cent. share of the global luxury dark spirits market by 2030. This plan entails an additional funding requirement of £10 million over the next three years to provide the necessary growth capital to increase production capacity, to further invest in laying down maturing spirit stocks and to grow the brand’s footprint in international markets. The offer by Nyetimber offers the prospect of an owner with the same shared strategic vision and crucially, certainty of funding.

By joining the Nyetimber family of companies, The Lakes will benefit, in particular in terms of quality of production, brand marketing and routes to market. The Lakes Directors are confident that this will confer significant benefits to The Lakes’ long-term prospects both as a brand and as a company and the Nyetimber offer, which values The Lakes at an enterprise value of approximately £71.0 million, equivalent to a multiple of 12.2 times net revenues for FY23, represents not only the best way to ensure that The Lakes remains fully funded but also provides fair value for existing shareholders at this stage in The Lakes’ growth journey.

We are pleased to recommend the Acquisition to our shareholders and I look forward to working with Eric and the Nyetimber team as we continue our journey to build a luxury international spirits brand.”

Commenting on the Acquisition, Eric Heerema (CEO of Nyetimber) said: “We are excited by the prospect of acquiring The Lakes, the leading English distiller of premium quality Single Malt Whisky, Gin, and Vodka. We believe that this potential acquisition represents an opportunity for us to expand our capabilities, drive exciting new growth and support The Lakes in delivering on its ambition to be a globally recognised spirits brand. Not only do we have an inherent understanding and strong relationships with the world’s leading luxury restaurants, bars and retailers, but we also have a shared strategic vision.”