Azur Associates
shutterstock_1316148788.jpg

Azur.I: Azur Intelligence

 

At Azur Associates, one of our key goals is to provide our clients with the up-to-date, insightful information and analyses they need to make the best decisions for their business.  We have two seasoned team members dedicated solely to this task.  While, of course, we can’t release full studies that are confidential to our clients, we enjoy sharing some highlights as well as perspectives on more public situations in the industry.  This is Azur.I: Azur Intelligence.

 
 
 
 

Azur Associates Wine M&A Summary | Q3 2023

Transaction focus continues to be weighted to high value unique assets.

Wine M&A activity in the third quarter of 2023 proceeded at a steady pace and demonstrated continued buyer demand for premium brands and vineyards. Lurking in the background are some additional trends for a larger segment of the market that we will call out in more detail when we release our 2023 Summary + 2024 Outlook in the coming months.

In the U.S.:

The third quarter highlight for U.S. Wine M&A was clearly headlined by Gallo’s acquisition of Rombauer Vineyards. Like many U.S. brands that started 40 years ago, there are a number of stories to tell as it relates to Rombauer.

Rombauer Vineyards’ first vintage was in 1980, which was quite a good time to get started in the Napa Valley.  Different from many other Napa Valley producers, Rombauer elected to make its name in Chardonnay. They became known as the leader in premium Chardonnay and built an extraordinarily strong brand. The fact that Gallo acquired Rombauer is significant for a number of reasons and a testament to Gallo’s belief in the premium segment of the wine business. While great vineyards and real estate were included in this transaction, this was about ownership of a specific leading brand in an important category and price segment. We have a lot more to say about other aspects of this transaction, but will save that for another day and summarize that this was a very good outcome for the Rombauer brand, Gallo, Napa Valley, and the premium wine category as a whole.

As has been a trend in 2023, several premium vineyard transactions took place in the Napa Valley particularly, where demand remains very strong for good vineyards in strong AVA’s. 

Overseas buyers continued to be active - including France, with Chanel-owned St. Supéry’s acquisition of a premium Rutherford vineyard, and Italy, with Frescobaldi’s acquisition of Domaine Roy’s estate vineyards and winery in Oregon.

Two route-to-market transactions of note were: RNDC’s acquisition of Natural State Distributors in Arkansas, expanding their national footprint to add Arkansas as a state; and Opici’s acquisition of Pacific Highway, which will help Opici increase its portfolio and bring further resources to help drive their national business.

GLOBALLY:

Premium vineyard transactions followed suit overseas as well, including the acquisition of Saint-Estèphe’s fifth generation-owned Château Tour des Termes by a private Irish investor. Additionally, a focus on premium sparkling wine included Masi’s acquisition of Casa Re in Lombardy’s Oltrepò Pavese area, as well as the acquisition of sparkling-focused English winery Hambledon Vineyard by a consortium led by Berry Brothers.  As has been published with more frequency, the English sparkling trend is accelerating and we expect to see more M&A activity in this region.

As noted above, we look forward to sharing additional thoughts in our 2023 Summary + 2024 Outlook coming soon.

Patrick DeLong