Arran Brewery considers partial sale of brewery hotel

The brewer may sell a 45% stake in its Loch Earn brewery hotel and visitor centre, situated in Perthshire, Scotland.

The company, which has been operational since 2000, intends to sell to another brewer, hospitality firm, venture capital firm, or to the public through a crowdfunding arrangement.

The site features 33 bedrooms, three bars, three restaurants, a coffee shop, and a brewery which produces 3,500 litres a day.

Gerald Michaluk, managing director of the brewery, said a new shareholder model was needed to avoid paying “a higher than needed” duty level while the brewery expanded.

He said the brewery was looking to replicate a model used by the Glaswegian Drygate Brewery and its shareholder Tennents Caledonian Brewery.

If the brewery were to produce more beer, its duty rate would increase substantially, he said.

Piece of big pie

Michaluk continued: “This is the fault in, an otherwise excellent, HMRC duty reduction model that levels the playing field between the very large breweries and the small breweries.”

The brewery currently qualifies for a 50% duty reduction but only if it sticks to three days' production per week, he said.

“By selling the stake in the business, we can fund the remaining elements of the project and make it fly.

“There is a saying that a piece of a big pie can be better than the whole of a small pie. We hope to find a partner who will share our vision for the site and that together we can complete this project and benefit our shareholders and stakeholders alike.”

So far more than £700,000 has been invested in readying the brewery and cider production facility at the site for the next stage of growth.

Plans for the site also include apple brandy, gin and whisky production.