Hope still lies at the heart of Bothwell’s Nant Distillery

TEN years ago, young up-and-coming Queensland businessman Keith Batt bought and restored the heritage listed Nant Estate.

Every barrel at the Nant distillery near Bothwell needs to be sampled during the due-diligence audit in preparation for Australian Whisky Holdings Limited taking possession. Picture: MATHEW FARRELL

TEN years ago, young up-and-coming Queensland businessman Keith Batt bought and restored the heritage listed Nant Estate.

His plan — to take the art of whisky making back centuries.

The Nant Distillery, just outside Bothwell in the Central Highlands, would produce a single-malt whisky made from barley grown in the fields nearby, steeped in water pumped from the millpond on the estate and ground by millstones in a convict-built, water-powered sandstone flour mill on the estate.

At the time Mr Batt said: ‘‘I’ve got a young family, I’m a keen fly fisherman and we’re close to the lakes, this place is ideal.”

The Nant Estate has been growing barley since 1821.

Bothwell, one of the earliest inland settlements of Scottish migrants, was the granary of Australia during the 1830s, when drought devastated NSW.

Millwright Pete Bignell, who had restored the family flour mill next door to the Nant, restored the Nant mill.

Bignell magically started the ancient steel and cast-iron wheel that churned over water that now rushes over a sandstoneflagged floor, which was hidden under more than a metre of mud and silt for decades before the restoration led by the Queenslander.

Award-winning distiller Bill Lark was closely involved with Nant, training staff and advising on productions procedures.

At the time, the Tasmanian whiskey icon said: ‘‘Tasmania will be become the whisky capital of Australia.”

Selection of whiskys from the Nant Distillery. Picture: MATHEW FARRELL

A decade later and his prediction has been on the money.

Tasmania has won award after award for a robust group of distillers making whisky, which is indeed the talk of the world.

But the story for Nant is far different.

An investment barrel scheme lies at the centre of its problems.

Mr Batt offered a barrel buy back program to subscribers, which paid almost 10 per cent annually on each barrel.

For $25,000, you could buy two barrels, earning you, over four years at 9.5 per cent compound interest, $36,000 — a return of more than $10,000.

Nant also guaranteed to buy back your barrels at the end of the maturation period of four years.

But then Mr Batt filed for bankruptcy late last year, with personal debts mounting to more than $16 million.

MORE: INVESTOR FEARS BANKRUPTCY WILL LEAVE HER HIGH AND DRY

At the time he denied that Nant was in financial crisis. He said the bankruptcy related to his failed property development business.

“Nant is a very strong, very vibrant company in a wonderful state with a great product,’’ he said.

In the meantime News Corp finance writer The Barefoot Investor followed the Nant story closely, writing several stories of investors having a hard time tracking down their barrels.

And several investors contacted The Mercury with similar stories.

Fast forward to mid-October and Australian Whisky Holdings Limited signed an agreement with the Nant Group to buy the Nant Distillery business and historic Nant Estate property for $3 million.

The company will take on $5.5 million worth of Nant debts and liabilities — after due diligence.

It has bought all the whisky production assets, but not the bars and hotel in Hobart, Melbourne and Brisbane associated with Nant.

MORE: NANT WHISKY DISTILLERY IN NEW HANDS

AWY owns a 31.66 per cent share of Tasmanian whisky company, Lark Distillery — which owns outright the Overeem Distillery — and a 12 per cent share of the Redlands Estate whisky distillery.

AWY executive director Chris Malcolm was this week holed up at Nant, following the conditional sale, carrying out a forensic investigation of 1600 barrels, many of them stored across two floors of a giant 200-year-old horse stable.

Nant sales and marketing director Kate Dowd said on Wednesday she was once an employee of Mr Batt but now works for AWY.

Ms Dowd is at Nant while AWY attempts to get accurate answers on the barrel investment scheme by conducting a thorough due diligence process, weighing, tasting and testing each barrel to create an accurate barrel data base, she said.

Every barrel at the Nant distillery near Bothwell needs to be sampled by the likes of whisky taster Mark Nicholson during the due diligence audit in preparation for Australian Whisky Holdings Limited taking possession. Picture: MATHEW FARRELL

“There are two lots of information — my task over the next few days is to get one source of the truth — the barrels -to correlate with the Nant records that are now held in AWY’s Sydney office,” she said.”

Ms Dowd said the one lesson for investors from Nant’s barrel scheme is: “Do your own due diligence — you should get terms and conditions when you invest in anything — make everything you sign you know what you are signing.”

MORE: FEDERAL COURT JUDGE DUNCAN KERR CAUGHT IN NANT SCHEME

Meanwhile, 10 staff, including professional whisky tasters and bottlers are painstakingly selecting each barrel weighing it, siphoning the whisky and tasting it.

Nant bottler Dirk Schmid bores down into each barrel and siphons a small amount of whisky into small containers. Each sample is labelled with the number of the barrel from which it comes.

The samples are carefully taken down the steep stable stairs to professional taster Mark Nicholson, who has been engaged to evaluate the quality of the whisky.

“I drink very little — it’s mostly nosing and occasionally putting it across the palette,’’ Mr Nicholson said.

“When you’ve got 50 to 60 samples to do in a sitting it’s not very wise to drink too much cask strength whisky — you’re judgment starts to colour a little.

“It sounds like a wonderful job but it’s quite an arduous job.”

He fills out a score sheet and writes occasional comments on each batch.

On Thursday Bill and Lynne Lark met with Mr Malcolm in Hobart for dinner.

Mr Malcolm said the rumours and innuendo surrounding Nant has tarnished the Tasmanian whisky industry. There was nothing wrong with Nant whisky, fault lied with the business practice of the previous owner, he said.

. “The whisky is fantastic and the guys distilling the whisky are superb,” he said..

“But we have acquired the rights to buy Nant and we need a 60 day due diligence period so we can verify what the facts are, because nobody really knows.”

Mr Lark disagrees, saying the Nant issue won’t do any long-term damage.

“The Nant situation has been boiling away for a while and people had concerns but my experience has been there has been no impact on our reputation,’’ he said.

He said Nant still has the potential to be one of the state’s iconic distilleries.

“I think the future looks very good.”

Mr Malcolm said investors wishing to inquire about Nant whisky barrels could ring Jacqueline Molina at Australian Whisky Holdings on 0497172666. Or email [e-mail]. He encouraged people to have a share certificate of receipt.

Originally published as Hope still lies at the heart of Bothwell’s Nant Distillery