It is the stuff of dreams, and Glenmorangie, put up for sale by the family that controls the quoted company, has done its share of stirring up the romance of the highlands and islands in the interests of shifting whisky.
The marketing men talk of “brand-building” and “heritage”. The advertising, with spine-tingling music and mellow tones, welcomes us to the “Glen of Tranquillity”. The distilleries are on Islay, in Elgin on Speyside, and Tain in Ross-shire, where the flagship brand is watched over, we are breathlessly told, by the legendary 16 men of Tain who alone hold the secret recipe of Glenmorangie.
The reality is that after distillation, Glenmorangie’s glorious whiskies are stored, aged, bottled and marketed from an industrial estate at Broxburn, near Edinburgh.
Nestling under a viaduct for the Edinburgh-Glasgow rail link, the company’s two-storey headquarters are a long way from the Glen of Tranquillity.
That is especially true this week. Paul Neep, chief executive, has the air of a man in a hurry after three solid days of talking — to media, investors and staff — about the turn of events that has put the company up for sale to the highest bidder.
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Last week Glenmorangie went public with news that had been sprung on it two months ago — that the Macdonald family, who own 52% of the company, had decided to sell up, triggering a sharp rise in the share price and a worldwide search for new owners.
Neep admitted, however, that he had been surprised when David Macdonald, at 71 the senior family member and a former director, told the board what they intended to do.
“The family feel it is the right time for them,” he said. “It’s a combination of things. It’s a realisation that they can’t be the dominant shareholder for ever. The major shareholders within the family are getting older — they are in their seventies — and they would like to control the process while they can.”
He also cited commercial reasons — the business is doing well, the brands are growing, and this is reflected in the share price.
With NM Rothschild, the investment bank, running a worldwide auction and analysts estimating bids for Glenmorangie of between £240m and £300m, the sale could fetch up to £150m for the Macdonalds.
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Valuing whisky companies is notoriously difficult. So much of the value is in the brand and the whisky stocks laid down over many years. Glenmorangie stocks are valued in the books at historic cost -— £83m — but insured for £400m.
Glenmorangie sells 300,000 cases a year, Glen Moray 40,000 and Ardbeg, one of the Islay malts, 35,000.
The share structure underlines the family’s power: 11m A shares have a single vote each; 4m B shares carry five votes each.
Brown Forman, the American distributor, has 25% of the A shares and a seat on the board, and is seen as having an inside track on Glenmorangie. But the power lies elsewhere — 52% of the shares overall, and a large majority of the B shares are owned by the Macdonalds.
Glenmorangie has been in The Sunday Times 100 Best Companies To Work For during the past three years. Management and workforce doubtless hope this will continue under a new owner.
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Investors want the best price, but the family says it wants an owner that will invest in growth rather than strip assets. Otherwise there will be tears in the Glen of Tranquillity.