Investment

Posted by: Nick

Over the duration of co-running this blog, I have waffled at length about the friendly and supportive whisky community in my home state of Tasmania. Well, forget all that – because a Tasmanian distillery is in trouble and no one seems to care.

It was recently revealed that the founder, figurehead and all-round head honcho of Nant Distillery, Keith Batt, has filed for bankruptcy. Batt, a Queensland businessman, built Nant distillery up from nothing, restoring the old water mill and establishing Nant whisky bars across the globe; not to mention claiming several liquid gold prizes along the way for his wares. He’s done amazing things for Tasmanian whisky – so why are people not more concerned for his distillery?

I’ll admit that I am exaggerating a touch in saying that no one cares – I for one certainly care. Over the years I’ve experienced many pleasant evenings sampling drams at the Nant Whisky Bar in Hobart, enhanced immeasurably by their wonderful staff members who are always happy to indulge my whisky curiosity. I have visited the picturesque distillery in Bothwell and enjoyed wandering their grounds on a near perfect summers day. I own a bottle of their port matured single malt and will be sad when the last drop disappears. I will forever stand by the product and the staff. But Nant Distillery itself is a hard one to like.

I love being part of this little whisky business here in Tassie so much so that I sometimes forget that it is exactly that – a business. Nant’s management have not lost sight of this. Keith Batt has not set out to make friends, but to create a whisky empire bent on global domination. Taking part in local Tasmanian tasting events is not part of this vision. Nor is pooling resources and sharing promotion. Other distilleries are not co-creators, but competitors. This outlook is both business savvy and totally opposite to the remainder of Tasmania’s close-knit distilling community. I agree with Batt’s motives, but not his means.

Say what you will about the man – but he sure builds a pretty distillery

So how exactly will Keith Batt’s bankruptcy affect the distillery? According to the man himself, not at all. Batt is understandably keen to calm the waters, pointing out to The Mercury in Hobart last week that as of August last year he is “not a director, a shareholder or a beneficiary of that trust”. This role was recently (and conveniently) reappointed to his wife, Margaret Letizia. And yes, it does all sound rather dodgy, although it can be said that his financial problems were not in fact due to distillery-related debts, but issues for his property development business which is still experiencing a hangover from the global financial crisis of six years ago.

There are a number of people waiting with baited breath for the smoke to clear over Batt’s financial problems. For a start there are the thousands of investors who have pledged over 18 million dollars into barrels of whisky that they may never see. I caught up with one such investor who told me:

“As a whisky barrel owner, you start to wonder how much substance is contained within the creamy embossed paper of the share certificates. I don’t own the barrels, only what is in them and should the business go under I don’t know what I’m going to do with four hundred and fifty litres of half finished whisky or even how I’d get it home. Can you just turn up with a boot load of jerry cans? Guaranteed buy back? Nothing is guaranteed.”

While most seek only to see their money returned, others have attempted to claim their barrel with little success. However, for a man so protective of his brand, I can understand his hesitancy in seeing his product in other bottlers’ hands. Referring to them as “inferior brands” however is an unkind assumption and further evidence of why he is far from popular among the Tasmanian distillers community.

Photographic evidence of a great afternoon at Nant. Yep, isn’t my beard awesome.

It’s hard to fully sympathise with the struggling Keith Batt and his business-first methodology. However, I prefer to make my best effort to differentiate the distillery from its management. For the sake of their investors, their staff and heck, let’s not forget their high-quality whisky, I hope that Nant Distillery is not adversely affected by their founder’s financial predicament.

Posted by: Ted

The whisky scene in Australia, by its very nature as a young and emerging industry, has hitherto always been gloriously independent. Brave and adventurous souls carving out their own mark in this new frontier of whisky making, men and women free to pursue their own ideologies and dreams. Very different to the crusty, entrenched old world, where the multitudes of distilleries are weighed down by centuries of tradition and the idea of a truly independent producer is hard to come by in the face of hungry multinationals.

It was always going to happen you know. Never a doubt. You can bet your bottom dollar that ever since Bill Lark emerged from the Tasmanian Highlands as an enlightened being, the big boys have been keeping a very close eye on developments in the antipodes. If the Australian whisky scene succeeded in its ambitions, and my word it most certainly has, the sharks were always going to be circling ready. There have been a few nibbles here and there over the years, but finally someone has taken a proper bite.

Diageo, global spirits bigwig and owner of globally renown brands such as Johnnie Walker, Smirnoff and Baileys, has decided to take a chance navigating by the southern constellations and bought a minority share in Victoria’s New World Whisky Distillery, makers of Starward whisky. Starward, with excellent releases such as the Apera cask single malt or the quirky ginger beer cask, has been making waves both at home and increasingly overseas, so it is no wonder that Diageo has considered it to be a worthy venture to invest in.

How this moment changes the landscape in Australia is yet to be seen. It is only logical that as the industry increases, the big boys will continue to invest in distilleries they consider to be appropriate extensions of their brand. To be honest this is actually a really good thing for Australia, as it will allow for much greater growth within the sector, solidify the local market, give better extension into new overseas markets and help whisky in this country mature and gain further acceptance as an world class product.

But… at the same time we have to hope that this evolution doesn’t come at the cost of the attitude and culture that makes Australian whisky unique. It would be sad if that spark was lost through homogenisation and the finance-driven whims of corporate overlords. The whisky produced by Australian distillers is exceptional, a sentiment backed up by a slew of prestigious awards; if the quality of the spirit was diminished through bottom-dollar bean-counting it would be a slap in the face to the ideals of the men and women who have worked hard to bring this industry to life. Then again, even the hardest-boiled rager-against-the-machine has to admit somewhere along the line that these guys seem to have some vague idea about what they’re doing, so hopefully good stewardship and passion for the product will win the day.

Actually, come to think of it, something quite extraordinary may emerge out of all this. As we all know, Diageo’s flagship whisky is the Johnnie Walker, the highest profile blended whisky in the world. If Diageo keep adding Australian cup winners to its stable, who knows, maybe we’ll see the release of a true-blue Aussie blend! Strewth, prepare ya cakehole for the dinky-di Jonno Walkabout “MAAAAATE” travel-exclusive series, featuring the likes of the ‘Bronze Surfie’, the ‘Flamin’ Pink Galah’ and of course, the ‘Blue Bogan’.

The future is here and it’s a Brave New World. Watch this space.

Whisky Waffle

Two Tassie boys talk whisky

Trouble at Old Mill: Tasmanian distillery rocked by bankruptcy

A Brave New World: Diageo invest in Australian distillery