The Spirits Division for Modesto, California-based E. & J. Gallo Winery today announced that it has acquired Agave Loco LLC, a Vernon Hills, Illinois-based company that owns cream liqueur brand RumChata, which it produces in the City of Pewaukee.
The terms of the deal were not disclosed.
Gallo’s flagship spirit brand, E & J Brandy, is among the company’s portfolio of successful spirit brands, including New Amsterdam vodkas and gins, Germain-Robin Brandy, High Noon Sun Sips Hard Seltzer and more.
Agave Loco was founded by brothers Tom and Duane Maas and their late father Duane Maas in 2009. The family-owned business also owns Pewaukee-based Midwest Custom Bottling LLC, where Agave Loco produces RumChata in two 70,000-square-foot facilities.
As part of the transaction, Gallo is also acquiring Midwest Custom Bottling, which also owns the Tippy Cow and Holly Nog brands. MCB’s 32 employees will join Gallo’s team as part of the deal, and Gallo will continue to produce RumChata in Pewaukee, Duane Mass said.
“As a small independent producer, we never imagined the success of RumChata when we were just getting started back in 2009,” said Tom Maas, RumChata founder and master blender. “We have taken the growth of the brand as far as possible as a small supplier, and it was the right time to find a new brand steward.”
MCB now produces about 560,000 9-liter cases per year, making it the 30th largest liqueur brand in the U.S., said Duane Maas, adding that for comparison, Baileys Irish Cream produces about 2 million cases.
“It’s grown from just an itty-bitty deal, 2,000 cases the first year,” he said.
The RumChata brand has continued to innovate over the years and in 2016, launched MiniChata, which are 25ml cups for consumers to add RumChata to their coffee.
A year later, RumChata Cold Brew was introduced and most recently RumChata Limon was added to the company’s product line. RumChata has also released a variety of seasonal offerings, including RumChata Peppermint Bark for the holiday season.
“We see tremendous potential with this acquisition to further innovate in the premium spirits space with unique consumer propositions, while continuing to add value to our wholesaler and customer partners,” vice president and general manager of Gallo’s spirits business Britt West said in a statement.