Treasury Wine agrees to buy Diageo Chateau and Estates

[crusty2]

saw this on another wine site

Treasury Wine agrees to buy Diageo Chateau and Estates for $600 million
Treasury Wine Estates today announced that it has agreed to acquire the majority of assets from Diageo Plc’s US and UK wine operations. The cash payment of US$600 million comprises $US552 million plus the assumption of capitalised leases of US$48 million.
The acquisition of Diageo’s wine operations complements TWE’s established business strategy, and allows the Company to replicate its focus on efficiency, investment in marketing and positive transformation. Key US brands to be acquired include well-known brands Beaulieu Vineyards, Sterling Vineyards, Acacia, Provenance and Hewitt, amongst other assets.
TWE’s Chief Executive Officer, Michael Clarke, said: “This acquisition will transform our US business into a larger player of scale in the attractive Luxury and Masstige segments of the high growth US market. The additional supply of Luxury and Masstige wine will be a game-changer for our US brands, providing us with an immediate opportunity to step-change our growth in the US, Canada, Asia and Latin America.”
TWE will also acquire the Blossom Hill wine brand in the UK, the second largest wine brand in the UK by volume and value in FY15. “The acquisition of Blossom Hill in Diageo’s UK wine business will provide us with the scale and critical mass to deliver enhanced value creation from our combined Commercial businesses by accelerating our separate focus on the Commercial portfolio, globally,” said Mr Clarke.
The acquisition is subject to certain regulatory approvals, including anti-trust approval in the US, and is expected to complete in approximately three months.

link
http://www.wineberserkers.com/forum/vie ... 77&start=0

[Michael McNally]

Masstige?? What is masstige? Is it treated with raw cabbage leaves?

deliver enhanced value creation from our combined Commercial businesses by accelerating our separate focus on the Commercial portfolio, globally

How do you combine something and then accelerate a separate focus, globally?

Someone was paid a lot of money to come up with this dross. Less of this crap and we wouldn't be paying $70 for St Henri.

Cheers

Michael

[sjw_11]

Masstige is fake prestige for the masses... or affordable luxury .... An example in clothing would be

Zara - mass market
Massimo Dutti (same owner) - masstige
Gucci / Dior / etc etc - actual Luxury

Or in wine:
Anything with a penguin / bear / kangaroo - mass market plonk
Penfolds Bin range - Masstige
Grange - actual luxury

[phillisc]

And their share price is on the rise!
Me thinks the big payout and revolving door CEO policy is not too far away.

Cheers
Craig

[marsalla]

The more things change, the more they stay the same....

[marsalla]

http://winetitles.com.au/dwn/details.asp?ID=18454

Sepps Great Western to close.

Be terrible if they had a winery outside the Barossa wouldn't it...

[Sean]

deleted

[phillisc]

http://winetitles.com.au/dwn/details.asp?ID=18454

Sepps Great Western to close.

Be terrible if they had a winery outside the Barossa wouldn't it...

Marsalla, forgive me, don't quite get the last line, but yes not at all suprised, lindies a shadow, shifting of winemakers out of Wynns, seppelts to close, yet our stupid bloody government here in SA gives then millions for some Barossa venture after they closed Rosemount in MV.

Really like Seppelt...hope there is a fire sale and my third parties can get on to the end of a few deals. No doubt the consortia who purchased Seppeltsfield will be having a look.

Cheers
Craig.

[Sean]

deleted

[marsalla]

http://winetitles.com.au/dwn/details.asp?ID=18454

Sepps Great Western to close.

Be terrible if they had a winery outside the Barossa wouldn't it...

Marsalla, forgive me, don't quite get the last line, but yes not at all suprised, lindies a shadow, shifting of winemakers out of Wynns, seppelts to close, yet our stupid bloody government here in SA gives then millions for some Barossa venture after they closed Rosemount in MV.

Really like Seppelt...hope there is a fire sale and my third parties can get on to the end of a few deals. No doubt the consortia who purchased Seppeltsfield will be having a look.

Cheers
Craig.

Sorry for the sarcasm Craig, but it looks to me like the long term aim is to move all production to Nuri, besides a few micro wineries.

cheers

[crusty2]

yet our stupid bloody government here in SA gives then millions for some Barossa venture after they closed Rosemount in MV.

lucky we have an independent advocator for the wine industry in the form of Gail Gago.

[phillisc]

Just hope when she goes down to the 'private' cellar she systematically makes her way through the 60A, Bin 7 etc
Yes this bunch of muppets will hopefully be gone in 18 months

Cheers
Craig

[dave vino]

Surely the government needs to get involved in maintain the legacy of the Seppelt Great Western winery with it's historically important cellars and tunnel system. i.e it is heritage listed or something.

[cuttlefish]

Hopefully someone with a keen sense of history will save the "drives". You'd expect someone will.
It appears that Great Western as a brand is not seen as having any value. I'm surprised by that.

[Sean]

deleted

[Cactus]

Agree with many sentiments above. I cant help thinking all this is a mistake as well. What is the point of a brand? Don't you need honesty & integrity in the product? I thought our culture was heading more down foodie/hipster/organic/paddock to plate stuff? In which case how does this work? As a consumer how do I know where those grapes come from? Truthfully how does any of this work? The grapes come from all over SA & Victoria and then processed at 1-2 sites? So they keep spate the production of all the different brands? With different winemakers? Or does care, responsibility etc all just drop.

Does good fruit from say the Lindemans or Wynns sites, do they get syphoned off to go to new Penfolds bins at higher price points? So is the quality of the Lindemans St George, the Wynns Black Label, the Seppelt St Peters etc all drop by stealth? Are the reviewers & big retail outlets going to have our back on this? Probably no. Makes the work of good boutique winemakers, independent reviewers, retailers & this forum all the more important.

I think the list above would be good to keep in mind. Probably also worth looking at the corporate ownership of the other big places like Lion Nathan etc too if they go down this path.

[sjw_11]

Annie's Lane
Baileys
Coldstream Hills
Devil's Lair
Fifth Leg
Heemskerk
Ingoldby
Jamiesons Run
Killawarra
Leo Buring
Lindemans
Mildara
Penfolds
Pepperjack
Robertson's Well
Rosemount Estate
Rothbury Estate
Saltram/Metala
Seaview
Seppelt/Great Western
St Huberts
T'Gallant
Tollana
Wolf Blass
Wynns Coonawarra Estate
Yellowglen
Yarra Ridge

What is interesting is to see how many of these brands were their own wineries or at least had a physical presence of their own say 30 yrs ago versus now... I do somewhere have the Australian wine Atlas from 1985 but I can't find it. If I had to guess:

Annie's Lane, Yes (Queltaler), No
Baileys, Yes, No
Coldstream Hills, Yes, Yes?
Devil's Lair, Yes, ??
Fifth Leg - new brand
Heemskerk - newer brand
Ingoldby, Yes, No
Jamiesons Run, Yes?, No
Killawarra ??
Leo Buring, Yes, No
Lindemans, Yes, No
Mildara, Yes, No
Penfolds, Yes, Yes
Pepperjack ??
Robertson's Well, Yes??, No
Rosemount Estate, Yes, No
Rothbury Estate, Yes, No??
Saltram/Metala, Yes, Yes (still has a cellar door at least)
Seaview, Yes, No
Seppelt/Great Western, Yes, Not any more
St Huberts, Yes, No
T'Gallant, Yes, No?
Tollana, Yes, No
Wolf Blass, Yes, Yes
Wynns Coonawarra Estate, Yes, Yes
Yellowglen ??
Yarra Ridge ??

That's a bit sad in my view...

[Michael McNally]

I went to a large tasting on Sunday at a winery that was using fruit from:
Geelong
King Valley
Heathcote
Great Western
Henty
Grampians

Separate ferments, blending etc. to be sure.

There were a few different price points. Quality wines across the board to be sure, but why is it okay for a small winery to do the multi-region stuff but not a conglomerate. Or are we making assumptions....... ie. big = bad.

Cheers

Michael

[sjw_11]

but why is it okay for a small winery to do the multi-region stuff but not a conglomerate. Or are we making assumptions....... ie. big = bad.

I wasn't complaining as much about shipping fruit around to make wines in other locations, more about the fact that what used to be 20-something independent brands and wineries with their own identity is now one corporate behemoth that has mismanaged most of them.

[crusty2]

Seppelts. Well said Max Allen. article link for yesterday.

http://www.theaustralian.com.au/life/fo ... 305247e616

[dave vino]

Gave my thoughts on the matter on the article (whether it gets through the Moderation is another thing )

"Absolute disgrace. Places like this should be heritage listed, to stop the Fly by Night career executives coming in making decisions that reflect on their bonus the next financial year and then upping and leaving to screw over the next company they head up. A legacy like Seppelt should be maintained for future generations as an integral part of our wine and social history."

[swirler]

" Fly by Night career executives coming in making decisions that reflect on their bonus the next financial year and then upping and leaving to screw over the next company they head up."

Well said. I find it amusing that Max Allen's opinion is expressed in a newspaper that generally disdains any kind of subsidy/support to the unprofitable. Meanwhile another contributor (Halliday), on his own website, is quoting obscure Russian scientists (major hydrocarbon exporting country) to support his climate change denial views.

Gotta love the Australian!

[crusty2]

The other thing that has yet to be mentioned in Seppelts history in this thread is that there used to be an allocated part of he drives for the encumbent prime minister. I recall Fraser having one of the largest holdings many years ago when i last did a tour.
Not sure if it this heritage is still active. If so then they should put some influence behind heritage listing.

Cheers

[Chris H]

From a bygone era when Malcolm was the local member for Wannon. I'd imagine "partially" provided by Seppelt gratis on a quid pro quo basis hoping for exposure and serving at prestigious dinners.

[Sean]

deleted

[Michael McNally]

Thanks for the post Sean! A lot to digest there. Might have to reassess my purchasing loyalties......

Cheers

Michael

[odyssey]

Shocking news... went to the cellar door a couple of years ago and feel privileged to have seen it, some amazing history and wine coming from the area which really doesn't get the attention it deserves.

Looking at his linked-in, aside from not having a background in the wine industry it also looks like the CSO is also not a local... not hard to make the connection with the complete lack of regard for Australian wine history and local Grampians community shown by the move.

[Ian S]

“The Seppelt winery is being shut .... to reduce costs and remove unnecessary complexity”.

Refreshingly honest that they've declared their intention to turn the wines into mass-market swill. After all, who wants complexity in a wine?

Yes it all seems to be collapsing into a hyper-factory approach to winemaking, based out of the Barossa, but probably with token brands in NSW, Vic, WA to cater for regionalistic pride.

I share the view that it would not appeal to any buyers, as without vineyards included what is the point of buying a winery. At least with Seppeltsfield there was something of interest to the buyers. I reckon they might have got a very good price for Seppelts brand + current vineyards + historic winery. Instead they seem to believe they can get enough out of stretching the brand, to offset a building they can't sell (or will sell for a pittance).

It does appear to be clear that they intend to succeed by being efficient processers of grapes into wine. However why retain the (Non SA) vineyards? Trucking the grapes over longer distances will be very detrimental to the wine. The only reason I can see is that they want to tap into (or to insure against) regional pride, so that Victorians will buy Seppelts or Coldstream Hills because the grapes come from their state. Same with Devil's Lair (WA), Heemkirk (Tassie) etc. Most likely these will be retained as home market brands, but the overseas volume sales will be from SA.

Time to spend more on Best's, Tahbilk, Woodlands, Tyrrell's

[phillisc]

Sean, interesting!
I listened to the James Yates interview on ABC regional radio in the South East.
He was the former owner manager of the Poplars Winery and Chardonnay Lodge...so knows the area well.
He suggested that there were 30 job losses from Wynns...would not have thought that the winery has that many staff, aware that one of the winemakers went to Devils Lair in WA.
Perhaps its seasonal staff, but surely if 30 permanent staff were to go then the winery would shut??

Cheers
Craig

[swirler]

Trucking the grapes over longer distances will be very detrimental to the wine. The only reason I can see is that they want to tap into (or to insure against) regional pride

Isn't there an issue with Phylloxera doing that?