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Diageo announces £18m investment for Mortlach site

DRINKS giant Diageo is to throw its might behind the Mortlach distillery on Speyside by spending £18 million on doubling its capacity and launching a permanent four-strong single malt range.

Whisky from the distillery is an established contributor to Diageo's Johnnie Walker range of blends.

Currently it releases just a 16-year-old single malt as part of a range from lesser known distilleries.

Diageo, the world's largest spirits company, is styling its plans as the "rebirth" of Mortlach, Dufftown, which dates its history back to 1823.

The expansion will include the building of a new stillhouse to double capacity to 7.6 million litres of alcohol. Diageo will aim to replicate the complex distillation process at Mortlach which is based on six stills that are of different sizes.

Once launched fully in the summer of 2014, Mortlach will be available in four expressions aimed at global travel and the luxury and connoisseur segment. The four expressions start with the entry level Rare Old, progressing to Special Strength, 18-year-old and 25-year-old.

Diageo is particularly keen that Mortlach tap into the Asian and American markets that are key for top-end luxury malts while it also believes there remains a strong potential market on the European continent

In contrast to other recent more utilitarian developments undertaken by Diageo, such as the giant £40m Roseisle distillery on Speyside in 2010, which were primarily to boost production for its blends, Diageo is putting great attention on the look and design of the new Mortlach building so that it matches its drive to establish the drink as a luxury brand.

The Mortlach development is just the latest stage of Diageo's £1bn investment plans for Scotch whisky announced last year.

Pernod Ricard, owner of Chivas Regal and Ballantine's, is also building a new distillery in Speyside which it hopes to open some time next year.

Last week Edrington announced it is to invest more than £100m in a new distillery and visitor centre for Macallan whisky.

Meanwhile, further change is looming in the Scotch whisky industry after Vivian Imerman, a former owner of Whyte & Mackay announced plans to buy back the whisky brand if competition authorities force Diageo into a sale of the business it acquired with the purchase of India's United Spirits.

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