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Tequila And Mezcal Are So Hot In U.S., Even Vodka Makers Want In

An alcohol company synonymous with vodka is pushing into tequila and mezcal, a sign of the liquors’ burgeoning popularity in the U.S.

SPI Group, the company behind Stolichnaya vodka, is starting its own tequila and mezcal brands in the U.S. The idea is to capitalize on a shift by consumers toward the Mexican liquors, which have outpaced vodka and other spirits that once dominated bars.

It’s the first time the company has developed its own brands from start to finish. In the past few years, closely held SPI group acquired the distribution and marketing rights for established brands such as Achaval-Ferrer and Arinzano wines, Bayou rum and Kentucky Owl bourbon. A wide-ranging spirits portfolio is essential to serve customers that demand variety, according to Chief Executive Officer Hugues Pietrini.

“We saw very clearly the opportunity to develop our own program and to create a new brand in the category,” Pietrini said in a phone interview. He said there’s a special energy for the agave-based spirits in markets such as the U.S.

“There’s a whole thing happening in these markets around mixology,” he said.

A product called Cenote tequila goes on sale this month — with blanco, reposado and anejo versions available — while a cristalino variety will be available later this year. The company will also launch SeBusca Mezcal in anejo, reposado and joven varieties.

Rapid Growth
Tequila and mezcal have been growing at a rapid clip, while vodka volume growth has slowed. Tequila volumes gained 8.5 percent from 2016 to 2017, according to the Distilled Spirits Council, a trade organization. Meanwhile, vodka volumes grew just 2.2 percent.

The world’s largest distillers, Diageo Plc and Pernod Ricard SA, have made acquisitions in order to cash in on the trend. Bacardi Ltd. has also moved in, acquiring Patron Spirits International AG earlier this year in a deal valuing the company at $5.1 billion.

SPI Group, known as Stoli, decided to make its own brand. Pietrini, who took over as CEO about a year ago with a pledge to expand the company’s portfolio, said this lets the Luxembourg-based spirits maker focus on developing a product using the best ingredients.

“We are very excited,” he said. “Today the customer does not only want vodka."

This article was provided by Bloomberg News.

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