US spirits company Eastside Distilling has acquired Azuñia Tequila from Intersect Beverage, in a deal worth approximately $14.7m to expand its range of products and operational assets.
Azuñia Tequila produces handcrafted tequila using 100% blue weber agave grown in Mexico and an open-air fermentation process. The company offers four tequila products: Blanco Organic Tequila, Reposado Organic Tequila, Añejo Tequila, and Azuñia Black Tequila, all primarily sold throughout the western and southeastern US.
By purchasing Azuñia Tequila, Eastside will now hold a second national anchor brand, alongside its Redneck Riviera Whiskey portfolio. The deal will also provide Eastside with over 2,600 on-premise points of distribution and a direct sales team.
Under the terms of the agreement, Eastside will purchase Azuñia in an all-stock transaction provided that Eastside pays a portion of the consideration in cash or a three-year promissory note. Eastside has also agreed to issue additional consideration up to $1.5m reliant on the Azuñia business generating revenue of at least $9.45m in the next year.
President of Eastside Distilling, Robert Manfredonia said: “The acquisition of the Azuñia portfolio of tequila perfectly aligns with our go forward objectives to leverage and drive our national platform strategy which we believe will significantly expand shareholder value.
“The above-premium and luxury tequila categories are some of the fastest growing sub-segments of the spirits industry, and categories in which our regional and national distribution partners, as well as tier-one national accounts are actively seeking products.
“The team at Azuñia has created strong on-premise adoption of the brand, which, when combined with Eastside’s off-premise expertise is expected to benefit not only the Azuñia portfolio, but our other existing brands. We look forward to presenting Azuñia to key retail accounts beginning immediately.”
Azuñia Tequila was previously owned by Intersect Beverage, in which Stephanie and Pat Kilkenny were majority stakeholders. As part of the deal, Stephanie Kilkenny is expected to join Eastside’s board of directors, subject to their approval.
Stephanie Kilkenny said: “As we embarked on the next stage of growth for Azuñia, we recognised that what we were looking to create was exactly what Eastside Distilling could offer to us: a fully integrated sales organisation with strong distributor relationships and an existing footprint in the country’s largest independent and national retailers.
“Further, the cultural fit aligns perfectly with that of the Azuñia team which takes tremendous pride and passion in the products that we produce for our customers.”
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