Arran Brewery, the award-winning Scottish brewer, is reportedly in advanced talks with investors to fund a £1.6m expansion, which would see its beer become available across the UK for the first time.
According to the Herald newspaper, the Cladach-based company will use the new investment to open a new bottling plant in Scotland to help it increase volumes from one million to five million bottles a year over the next three years.
The group's beers, which include flagship beer Arran Blonde, are currently bottled at Marston's brewery in Burton.
The brewer, which currently produces some 500,000 bottles of its award-winning beer, is also reportedly in talks with Asda, Tesco and Sainsbury's regarding national distribution deals.
The brewery was bought out of administration by Glasgow-based Marketing Management Services International (MMSI), which is owned and operated by Gerald Michaluk, in June 2008, for an undisclosed sum.
Speaking to the Herald, Michaluk said: “We expect everything to be in place within six to eight months. In three years, when we reach five million bottles, that will take us to maximum capacity – but it will also take us to a £20m net profit by year five.
“We already have contracts in Scotland with Asda, Tesco, Sainsbury and the Co-op, but these latest deals with the multiples will take Arran right across the UK. We’re going national. But even then, the supermarkets will only account for 50% of sales.
Mr Michaluk told The Herald the £600,000 working capital would be funded by a bank loan and that the remaining £1m would be raised from “business angels and high-net-worth individuals”.
He also said he was in negotiations to establish a new bottling plant in Scotland, and is currently reviewing locations in Kilmarnock, a site near Ardrossan and another in Renfrewshire.
“The plant we eventually opt for will be bottling Arran beer within three months,” he said. “Arran blonde, our biggest-selling beer and core brand, will continue to be bottled by Marston’s at Burton on Trent, simply because it’s big and efficient.”
