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Waterford Distillery enters receivership

03 December 2024 By James Bayley

Irish whiskey producer Waterford Distillery has entered receivership, with founder Mark Reynier vowing to fight “until his last breath” to preserve the enterprise.

Reynier described the challenges as a “perfect storm” that began when the distillery launched its first whiskey in 2020. Speaking to The Sunday Times, he cited the Covid-19 pandemic, a global cost-of-living crisis, soaring energy costs, a sluggish distribution network and a misstep in the US market as major hurdles.

“We went to market right before lockdown,” he said. “We really didn’t have a full start with trying to launch our brand from the outset.”

Last week, the distillery’s staff learned that Mark Degnan and Daryll McKenna of Interpath had been appointed receivers after efforts to secure additional funding fell short.

Interpath will now seek a buyer for the distillery and its extensive stockpile. If a sale is not secured, the receivers may opt to liquidate assets to recover funds. Meanwhile, operations are set to wind down after the holiday period, with all 29 employees remaining in their roles until at least the New Year.

Rise and struggle

Reynier transformed Cherry’s Brewery in Waterford into a state-of-the-art distillery, supported by €17 million from private investors and the UK-based Business Growth Fund. Initial funding was secured through PNC, a UK challenger bank, before refinancing with HSBC in 2022. Reports suggest the company owes HSBC approximately €70 million.

Reynier, from a family with a wine-merchant heritage, previously co-led the acquisition of Islay’s Bruichladdich distillery, which was purchased for €6 million and sold to Rémy Cointreau in 2012 for £58 million.

Despite Waterford’s critical acclaim and premium packaging, sales never matched expectations. Annual turnover remained less than €3 million, even as the distillery amassed a whiskey stock valued at €140 million.

Waterford’s challenges were exacerbated by limited resources for brand promotion, leaving it vulnerable during economic downturns. Reynier also acknowledged mistakes in his US strategy, noting that the Irish whiskey market there had contracted by 18% over two years due to overstocking during the pandemic.

Reynier’s reflection

Reynier expressed his regret in statements on social media, writing on X: “Better to have tried and failed than never to have tried at all. Our Waterford team have been superb – I’m sorry to have let them down.”

The outcome of the receivership process will serve as a litmus test for global interest in Irish whiskey, which until recently was booming. HSBC, which had provided a €45 million financing package to Waterford in 2023 has been approached for comment.

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