Fortune Brands' rum maker signs 30-year deal with U.S. Virgin Islands

CHARLOTTE AMALIE, U.S. Virgin Islands -- The U.S. Virgin Islands has negotiated a 30-year revenue deal with the owners of locally produced Cruzan Rum, which has a heritage on St. Croix dating to the 18th century.

Gov. John DeJongh said late Tuesday that the concessions for the company will help expand the rum brand and generate a "significant long-term revenue stream" for the cash-strapped U.S. Virgin Islands. It must be approved by the islands' legislature.

Cruzan is owned by Deerfield-based Fortune Brands Inc., which makes products ranging from Jim Beam bourbon to Titleist golf balls. It acquired the St. Croix-produced rum in September 2008.

Under the 30-year pact, the Virgin Islands government commits to sharing the cost of molasses, a critical ingredient in rum production, as it has for the past several decades.

It also vowed to continue to invest a portion of tax revenues generated from rum to promote local brands and will provide financing for construction of a wastewater treatment plant to boost capacity of Cruzan's St. Croix distillery.

"This agreement demonstrates a commitment to securing Cruzan's long-term future in America on St. Croix, building on a heritage of rum production that dates back to 1760 on our site," said Gary Nelthropp, president and master distiller of Cruzan Rum.

Earlier this year, DeJongh announced construction of a Captain Morgan rum distillery in St. Croix. The U.S. Caribbean territory agreed last year to issue US$165 million in bonds to help build it.