US private-equity firm Rodeo Drive Capital has secured a 5.5% share in Tequila producer Doheny Road Spirits.
The initial stake is estimated to be worth $1.7m, Jason Gilbert, managing partner at Rodeo Drive Capital told Just Drinks.
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Set up in 2023, the Las Vegas, Nevada-headquartered and family-run Doheney Road Spirits produces the Rodeo de las Aguas Tequila brand.
Gilbert said the latest investment will go towards expanding the production capacity at the Rode de las Aguas’ distillery in Jalisco, Mexico. “This expansion will include enhancements in supply chain logistics to ensure consistent product quality and availability”, he explained.
An agreement has also been reached for Rodeo Drive Capital to acquire another 5.5% bringing its total shareholding percentage to 11% by the end of this year, he said.
The deal was struck through Rodeo Drive Capital’s separate investment arm Royal Eagle Fund.
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By GlobalDataThe stake in Doheny Road Spirits marks Royal Eagle Fund’s first investment. For now, the group has no plans to invest in other brands.
“We believe in concentrating our resources to maximise the success of this investment before considering additional ventures”, Gilbert said. “However, we continuously evaluate other opportunities in the artisanal spirits sector to ensure we are well-positioned to capitalise on market trends.”
Rodeo de las Aguas Tequila comes in añejo, reposado, cristalino añejo and blanco varieties. It is sold to on- and off-trade channels locally in Las Vegas, including high-end restaurants and bars and at retailers like Total Wine & More.
Rodeo Drive Capital’s cash injection comes as the group starts expanding nationwide and entering international markets. Rode de las Aguas is expected to expand to other states such as Texas, Georgia and Connecticut later this year. It has also recently secured a distribution deal with an unnamed distributor for Armenia in western Asia.
Though Doheny Doheny Road Spirits “is exclusively focused on its flagship product”, Gilbert indicated “there are plans to explore other spirits in the future”.
