(Photo: Ilegal Mezcal)

Bacardi, the world’s largest privately owned international spirits company, has finalized a $130 million deal to buy Ilegal Mezcal. The purchase signals a major shift in the market as once-niche agave spirits are now being catapulted to the mainstream.

Rumors of the deal first began circulating in May, when Bloomberg Finance reported that Bacardi was looking to up its 20% stake in the brand to 100%.

Ilegal was founded in 2004 when founder John Rexer began smuggling bottles of mezcal from Oaxaca, Mexico to a bar he owned in Antigua. In the nearly two decades since, Ilegal has released an unaged joven, a 4-month reposado and a 7-year extra añejo.

Despite its illicit roots, Ilegal Mezcal is perfectly positioned for global expansion. The majority of its competitors —brands like Del Maguey, 5 Sentidos and Mal Bien — operate on a single-village model in which expressions are sourced from small-scale family producers. Ilegal, on the other hand, is produced entirely at one distillery, ideal for scaling to fast-growing demand.

“We believe that ILEGAL has the credentials to own and lead the super-premium mezcal category at a global level. ILEGAL perfectly complements our portfolio and bringing it into our business sets the brand up for even greater growth as mezcal captivates more and more consumers,” said Barry Kabalkin, Vice Chairman of Bacardi Limited.

Over the past decade, spirits juggernauts like Bacardi, Pernod Ricard and Diageo have cemented their investments in tequila. The mezcal category — projected to reach $2.1 billion by 2030 —  is now shaping up to become the next arena for major expansion.

Bacardi’s massive catalog of spirits includes the likes of Grey Goose Vodka, Bombay Saphire Gin, Dewar’s White Label Scotch and Patron Tequila. Ilegal will be its first, but probably not last, mezcal.

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