New Zealand's wine industry appears to have entered a period of consolidation that could ultimately result in more of the country's wines being brought into the U.S. market. The country's three largest wineries -- Montana, Corbans and Nobilo -- have drawn the interest of some of Australia's most prominent alcoholic beverage firms.
Australian wine giant BRL Hardy (whose brands include Banrock Station, Hardys, Leasingham and Stonehaven) has purchased New Zealand's third largest winery, Nobilo Wines. Hardy, which has had a distribution relationship with Nobilo for several years, became a founding shareholder in the winery by purchasing a 24 percent stake when it went public two years ago. Over the past several months, Hardy has acquired the remaining shares of the $23 million company, and the new owner took Nobilo off the New Zealand stock exchange last week.
"We are making a strategic investment in New Zealand because we see a lot of opportunity for New Zealand wines in international markets," said BRL Hardy managing director Stephen Millar. And BRL Hardy has the international muscle -- including its own U.S. distribution company -- to drive the growth of Nobilo's sales worldwide. In the United States, said Millar, "We launched Nobilo's Marlborough Sauvignon Blanc 15 months ago and have already sold more than 25,000 cases."
BRL Hardy is investing another $18 million in Nobilo over the next five years, spending it primarily on new vineyard plantings and a winery expansion.
Also last week, Australian brewer Lion Nathan increased its stake in Montana Wines, New Zealand's largest wine company, to more than 28 percent, subject to regulatory approval. Lion Nathan has bought into the winery several times over the past three months, largely to forestall other Australian companies from claiming Montana, which is the largest exporter of New Zealand wines (under the Brancott Vineyards label) into the United States.
Two other Australian companies, Foster's Brewing Group (owner of Mildara Blass, producer of labels such as Wolf Blass and Black Opal) and Southcorp (whose brands include Penfolds and Lindemans) are rumored to be interested in Montana.
Montana revealed last week that it is seeking antitrust clearance to buy its major competitor, Corbans Wines, New Zealand's second largest wine company. Other bidders -- including some Australian companies -- are also rumored to be looking at Corbans, which was put up for sale in May by its owner, D.B. Group, a New Zealand brewer. Corbans exported 23,000 cases of wine to the U.S. last year under the Corbans, Longridge and Stoneleigh brands.
"The biggest restriction in our export expansion has been insufficient supply," said Montana's chairman, Peter Masfen. By taking over a large winery, such as Corbans, and following an aggressive vineyard-planting program, Montana hopes to boost production to satisfy increasing worldwide demand for its wines.
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