Diageo to build $115m distillery in Kentucky

Diageo has announced it is to invest an estimated US$115 million over three years to build a 1.8 million proof gallon (750,000 9-liter cases) distillery and six barrel storage warehouses in Shelby County, Kentucky.  While finalisation of these plans is still subject to approval by local government, the project will represent a significant investment in Kentucky’s growing bourbon industry.  The proposed facility will distill a number of current and future Diageo bourbon and North American Whiskey brands.

Over the last year, Diageo’s momentum in American Whiskey has accelerated with both flagship and new-to-world brands. Fuelled by flavor innovations and consumer demand for premium brands with authenticity, bourbon is currently the fastest growing spirits category in the US, enjoying 14% value growth for the latest 52 weeks (Nielsen). This popularity is mirrored globally, with the total category growing 13% over the last three years, and within this, the super-premium price segment growing 24% (IWSR.)

“This proposed investment in Shelby County, in the heart of Kentucky bourbon country, will cement our commitment to expanding our share of the American whiskey category,” said Larry Schwartz, president, Diageo North America. “Diageo has a long tradition within the craft of whiskey-making and we look forward to bringing this artisanship to the new distillery. The distillery will build on our presence in Kentucky and we are committed to being a productive member of the local community.  We are very thankful for the support we have received thus far from state and local officials and look forward to a long and fruitful working relationship.”

Diageo will purchase approximately 300 acres of property located on Benson Pike in Shelby County. The company expects that the construction project will provide a significant number of jobs and anticipates employing approximately 30 people for whiskey distillation and maturation.

Diageo hopes to receive approvals and to break ground in the coming months with the goal of having the distillery operational in late 2016.

Diageo announced in February that it will be opening a Visitor Center at its Stitzel-Weller Distillery in Louisville.  Diageo hopes that the Stitzel-Weller Visitor Center will soon be included on the Kentucky Bourbon Trail.

29 May 2014 - Felicity Murray The Drinks Report, editor