Jack Daniel's toasts rising demand with new distillery

The makers of Jack Daniel's whiskey will spend more than $100 million to increase production to sate the growing thirst for the world-famous Tennessee whiskey.

Jack Daniel's maker Brown-Forman Corp will build a new distillery, adding stills, barrel warehouses and related infrastructure, to boost production at its Lynchburg, Tennessee factory, the oldest registered distillery in the United States.

"This is the first time since prohibition that we are going to be constructing a distillery from grassroots," Master Distiller Jeff Arnett told Reuters on Thursday.

Sale, production and transportation of alcohol was banned in the United States from 1920 to 1933.

The new facility will increase the production of the flagship Jack Daniel's Old No. 7 brand by 15-20 percent from more than 11 million cases per year currently, said Arnett, who is the seventh Master Distiller in the company's history.

Global sales of the Jack Daniel's family of brands grew by 9 percent in the last fiscal year, with international sales growth outpacing the United States.

The new distillery will use the same source of cave spring water as the existing one to maintain the whiskey's unique taste, the company said on Thursday.

The whiskey gets its distinctive flavor after dripping through 10 feet of charcoal, according to the company's website.

The more than 140-year old brand is the highest selling U.S. whiskey in the world.

Construction at the new plant will begin this fall and is expected to be completed within two years. The investment will result in about 90 additional full-jobs over the next five years, Brown Forman said.

(This story corrects spelling of Tennessee in first paragraph)

(Reporting by Siddharth Cavale in Bangalore; Editing by Joyjeet Das)