Diageo Announces Intention to Invest an Estimated $115 Million to Build Distillery in Shelby County, Kentucky

Investment signals commitment to high-growth North American Whiskey category

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May 29, 2014, 11:26 ET

SHELBY COUNTY, Ky., May 29, 2014 /PRNewswire/ -- Diageo today announced its intention to invest an estimated $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 finalization 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.

Proposed building design (PRNewsFoto/Diageo)

Photo - http://photos.prnewswire.com/prnh/20140529/92361

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.

"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."

"Today marks another feather in the cap for Kentucky's bourbon industry," said Governor Steve Beshear. "Distilled spirits remain a marquee industry in the Commonwealth, and Diageo's new distillery will ensure that even more Kentucky bourbon is enjoyed around the globe. I want to thank Diageo for investing in Shelby County, and I look forward to seeing the distillery in action."

"The Shelby County Fiscal Court is very excited that Diageo is proposing to expand its worldwide distillation operations by building a state-of-the-art distillery in Shelby County. We look forward to a great partnership with Diageo and we welcome them to the community," said Shelby County Judge-Executive Rob Rothenburger.

"This is a fantastic investment for Shelby County. It further solidifies our community as one of the fastest growing and business friendly areas in Kentucky," said State Senator Paul Hornback (District-20). "We are thankful for the positive economic impact this will bring and are proud that bourbon, a signature industry of Kentucky, will now be made right here in Shelby County."

"Diageo is a name known around the world for their large portfolio of leading spirits brands and we are grateful that they have chosen Shelby County as the home base for their distilling operations in Kentucky. This $115 million investment in the community will benefit our citizens for years to come. I look forward to working with Diageo as their Kentucky bourbon operations grow and I welcome them to this district," said State Representative Brad Montell (District-58).

"We couldn't be more thrilled for the company and the Shelby County community, as this major distilling center will bring jobs and increased investment to the region," said Eric Gregory, President of the Kentucky Distillers' Association, of which Diageo is a long-time member. "We applaud Diageo for its continued commitment to Kentucky and our signature Bourbon industry, and look forward to toasting this incredible landmark at its opening."

Over the last year, Diageo's momentum in North 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 U.S., enjoying 14% value growth for the latest 52 weeks[1]. This popularity is mirrored globally, with the super-premium price segment growing 24% over the last three years[2].

The proposed distillery will be designed to fit in with the surrounding countryside and during construction, Diageo will take measures to conserve the natural landscape in the area. Approximately 100 acres of land around the property line will act as a natural barrier to site operations. Diageo North America has a strong record of achieving zero waste to landfill in its operations, and the company aims to achieve the same in Kentucky. Diageo also plans to collaborate with the local community for the recycling and reuse of materials generated from the proposed facility.

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

On June 10, Diageo will hold an Open House to discuss the plans for the proposed Shelby County distillery, answer questions and hear from members of the public from 2:00 to 7:00 pm at the Shelbyville Country Club, 47 Smithfield Road, Shelbyville, Kentucky. A public hearing will be held on June 17 at 6:30 pm at the Stratton Community Center, 215 Washington Street, Shelbyville, Kentucky. Diageo hopes to receive approvals and to break ground in the coming months with the goal of having the distillery operational in late 2016.

About Diageo

Diageo (Dee-AH-Gee-O) is the world's leading premium drinks business with an outstanding collection of beverage alcohol brands across spirits, beer and wine. These brands include Johnnie Walker, Crown Royal, Bulleit, George Dickel, Buchanan's and Bushmills whiskies, Smirnoff, Ciroc and Ketel One vodkas, Baileys, Captain Morgan, Tanqueray, Guinness, Beaulieu Vineyard and Sterling Vineyards Wines.

Diageo is a global company, with its products sold in more than 180 countries around the world. The company is listed on both the New York Stock Exchange (DEO) and the London Stock Exchange (DGE). For more information about Diageo, its people, brands, and performance, visit us at Diageo.com. For our global resource that promotes responsible drinking through the sharing of best practice tools, information and initiatives, visit DRINKiQ.com.

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[1] Nielsen; xAOC less WA, 52 weeks ending 4/26/14

[2] 3 year CAGR, IWSR value 2009-2012

SOURCE Diageo