Dive Brief:
- Bacardi Limited announced it is now the sole owner of Ilegal Mezcal. Financial terms of the deal were not disclosed. It is the beverage company’s only mezcal brand, and builds upon the partnership it began with the brand in 2015.
- Ilegal has the credentials to dominate the premium mezcal space in the coming years as consumer interest in the beverage grows, Barry Kabalkin, Bacardi’s vice chairman, said in a statement.
- The super-premium mezcal category is projected to grow at a compound annual growth rate of 16% over the next five years, according to IWSR data cited by Bacardi.
Dive Insight:
Bacardi, known primarily for its namesake rum, is leveraging its expertise in the alcohol space to satisfy growing desire for premium offerings across different spirits categories.
In the press release, the spirits giant said the deal will help it capitalize on growing interest in alcohol containing agave, which includes mezcal and tequila. This category is projected to become the sixth-largest globally, and the U.S. has 86% market share of the super-premium mezcal category, IWSR data cited by Bacardi said.
While a beverage must contain at least 51% of blue agave to be called a tequila, mezcal can contain over 40 different strains of agave. The two liquors are also produced differently, with mezcal requiring the charring of the agave plant used.
Ilegal touts itself as an artisanal and sustainably produced mezcal, created using ripe agave in pit ovens and tahona mills in the Oaxaca region of Mexico, without any artificial flavors or additives. It was founded in 2006 by John Rexer, who said he aims to protect the environment and improve the local culture of the town it is produced in.
“We will always be committed to artisanal production, the Oaxacan community, and our core values,” Rexer said in the press release. “Being a part of Bacardi will bring ILEGAL to a larger audience while maintaining our commitment to sustainability and growing the business responsibly.”
Ilegal is available in three varieties — Joven, which contains a lightly smoky flavor; Reposado, which is aged six-months in medium-charred American oak barrels; and Añejo, aged for 13 months in new and used charred oak barrels.
Bacardi, which owns brands like Patrón tequila and Grey Goose vodka, has made other strategic investments in recent years as it aims to secure market share in the premium liquor space. Earlier this year, the company resolved a legal battle with rapper Jay-Z by buying a majority stake in his super-premium cognac D’Ussé, which Bacardi developed with the entertainer.
