The Lakes Distillery has raised a further £2.1m from investment manager Gresham House Strategic to fund its global growth ambitions move forwards its plans for the public listing.

The investment is on top of a £1.6m cash injection revealed last month by The Grocer from existing investors and high-net-worth individuals and takes the total investment into the business this year to £3.75m.

The funding from GHS is provided by a secured convertible loan note, structured to provide an 8% cash yield and a further fixed return through payment in kind.

It will convert to equity on a successful flotation – The Lakes Distillery announced in September last year it is exploring the possibility of an IPO on London’s AIM market.

This new funding is to support the growth of the business, which currently has a number of diversified income streams, and will be used for capital investment to increase production capacity, for working capital, and to enhance the distillery experience for visitors, all with the primary objective to build an internationally recognised whisky brand and build revenues around this core activity.

Nigel Mills, CEO of The Lakes Distillery said, “We’re delighted about the opportunities this investment opens up. We’ve been on an incredible journey so far, and Gresham House’s investment will allow us to take the business to the next level, grow production capacity and build our brand globally.

“The funding will support the growth of the business, allow us to expand of the amount of single malt stock we lay down for the future, and finance some critical capital expenditure projects, including further enhancing our distillery experience for visitors.”

Graham Bird, lead fund manager at GSM added: “The Lakes Distillery has an impressive and experienced management team led by Nigel Mills, CEO, as well as an excellent track record in its field.

“With ambitions to float the business in two to three years’ time, this fits our mandate very well for supporting pre-IPO companies as well as highlighting our ability to complete innovative deals which provide attractive, risk appropriate returns.”

The Newcastle based distiller has a production facility in the Lake District and has already established a UK and international sales base with gin, vodka and blended whisky ahead of its largest release of premium single malt whisky product in 2019.