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Fever-Tree tonic sells stake for £12m
Two London-based entrepreneurs have sold a stake in their tonic water company Fever-Tree for £12m.
Fever-Tree founders Charles Rolls and Tim Warrilow
Charles Rolls and Tim Warrillow, who launched Fever-Tree eight years ago, announced this week that they had sold 25% of the company to Lloyds Development Capital, a private equity arm of Lloyds, in a deal which values the company at £48m.
“It was a long process and we saw a bidding war erupt,” Warrillow said, adding, “I hope the British public are even more supportive than they have been now that Fever-Tree is state-backed.”
Before launching the premium tonic, the pair spent 18 months scouring the globe in an often dangerous mission for the best ingredients, settling on quinine from the Congo, Rwandan bitter orange oil and ginger from the Ivory Coast.
“Unfortunately, the only remaining plantation of pure fever-tree quinine is in the eastern Congo, one of the most lawless places in the world,” said Warrilow.
The pair launched the company with £1m that Rolls had made from turning around spirits brand Plymouth Gin and selling it to Absolut Vodka.
The company, based in Chelsea, has grown its range to include bitter lemon, ginger ale, club soda, lemonade and Indian tonic water.
The Fever-Tree range
In a short space of time, Fever-Tree has weaved its way onto the drinks lists of some of the top restaurants in London, including Claridge’s, Hakassan and the Ritz.
In addition, it is sold in Sainsbury’s, Tesco and Waitrose, leading to revenues of £16.2m last year, with a third of sales coming from the UK.
Rolls and Warrilow are going to use the cash from the sale to boost Fever-Tree’s presence in the UK and Spain, and accelerate expansion into the US.
The premium tonic has capitalised on the growing popularity of gin and tonic in the UK, US, and Spain, growing its revenue nearly 60% in the last three years.
In 2011, Fever-Tree scooped the drinks business award for Drinks Company of the Year, beating the likes of Bibendum and Chase Distillery.
Judges were impressed by Rolls and Warrilow’s passion “to be different and doing things differently”, and praised their creation of a new drinks category: premium mixers with beautiful packaging.