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Kentucky whiskey bankruptcies: Which distilleries are broke, and why
Multiple Kentucky whiskey distilleries have filed for bankruptcy amid falling demand and uncertain trade conditions.
Kentucky whiskey distilleries are finding operations are nowhere as smooth as the drinks they produce. Amid a gamut of problems, several distilleries have filed for bankruptcy.
As per the Kentucky Distillers' Association, the state's bourbon and whiskey industry is estimated to be around $9 billion. This comes amid an overall tough time for the American spirits and wine industry, which is seeing job cuts in an effort to remain profitable as the trading environment becomes more and more uncertain.
This January, Jack Daniel's parent company, Brown-Forman, announced that 12 per cent of its workforce was being let go, and that they were shutting down a barrel-making plant in Louisville, Kentucky.
So, which Kentucky distilleries have filed for bankruptcy?
Kentucky distilleries that filed for bankruptcy
LMD Holdings, the parent company of Luca Mariano Distillery, which is based out of Danville, filed for Chapter 11 bankruptcy. Court filings, accessed by Newsweek, show LMD Holdings has significant debt, including a "likely claim of over $25,000,000" which it owes to its largest creditor. Meanwhile, the Lexington Herald-Leader reported that some claims are under dispute.
The filing came just weeks after it launched in June, with owner Francesco Viola telling the publication that the move meant to ‘maximize the value of the assets for all stakeholders’ and that the company was ‘poised to emerge successfully, ideally with the support of its employees, customers, community and creditors.’
This is not the only such case.
Garrard County Distilling, a $250 million independent distillery, which started production in early 2024, was closed in April to settle unpaid debts.
Also Read | Will tariff cuts give bourbon whiskey the boost it needs?
Stoli Group USA filed for bankruptcy late in 2024, along with affiliate, the Kentucky Owl whiskey.
Recently, the sale of Kentucky bourbon Wild Turkey has seen a slump as well. Campari Group, which owns the brand and its Lawrenceburg and Danville distilleries, reported in its half-year results that sales of Wild Turkey and Russell's Reserve fell 8.1 percent year-on-year “due to a soft trend for Wild Turkey in its core United States market.”
Why are so many distilleries filing for bankruptcy?
Some of the challenges Kentucky distilleries are facing include cost-pressed consumers, shifting preference of young drinkers away from whiskey, and the potential impact of tariffs on sales in key export markets. Notably, these factors are also impacting other distilleries across the US.
Stoli, meanwhile, filed for bankruptcy on the back of a sustained slowdown in spirits demand in the US, and a cyberattack that took down most of its operations, CNN reported.
