Canadian wine colossus Vincor International -- whose portfolio includes wineries in Australia, California and Washington -- has purchased privately held Kim Crawford Wines in New Zealand. The company is paying NZ$14.8 million (US$8.6 million) up front, plus an incremental amount based on growth in profits, which will be paid at the end of 2008.
"We've been looking for a strategic super- and ultra-premium addition to our portfolio," said Donald Triggs, Vincor's president and CEO. "This one is especially delicious as it's located in one of the hottest and fastest-growing wine regions of the world."
Over the past few years, Vincor has rapidly expanded beyond its Canadian wineries, purchasing R.H. Phillips of Dunnigan Hills, in California, Hogue Cellars of Washington and Goundrey Wines of Australia.
The purchase agreement includes the Kim Crawford label, all existing wine stocks, a retail center and storage facility in Hawkes Bay on New Zealand's North Island, and all contractual arrangements with growers and suppliers.
Kim Crawford, whose company is based in Auckland, has not focused on ownership of vineyards or buildings, instead preferring long-term vineyard management and control agreements with quality-oriented grapegrowers. His winemaking is carried out in leased facilities in Auckland and at Marlborough Valley Cellars in Blenheim, on the South Island.
Crawford launched his eponymous company as a virtual winery in 1996 while working as head winemaker for Cooper's Creek winery. (Crawford produced the Coopers Creek Gisborne Chardonnay 1998 (90 points, $12), which was selected for Wine Spectator's Top 100 list in 1999.) He has won numerous awards and honors for his wines.
Crawford's whites, including Chardonnay and Sauvignon Blanc, regularly score in the high 80s and low 90s on Wine Spectator's 100-point scale. As a result, demand in the United States for Kim Crawford wines has grown steadily in recent years. He also makes reds, such as Merlot and Pinot Noir, which have earned good to very good ratings.
Crawford will remain in his position as managing director and head winemaker. His wife, Erica, will continue to develop the sales and marketing side of the winery.
Triggs described the agreement as beneficial for both companies. "Kim was facing financial challenges in keeping up with the demands of expansion," he said. "Vincor can provide the backing need to grow the business."
Vincor plans to double Kim Crawford's production, which was 86,000 cases in 2002, over the next five years. As far as distribution goes, Triggs said, "The top five markets for New World wines are the United States, followed by the U.K., Australia, Canada and the Benelux countries. That's where we're focusing our efforts."
Check our ratings of Kim Crawford wines.
Read more about Kim Crawford and New Zealand:
Read more about Vincor:
Sips & Tips | Wine & Healthy Living
Video Theater | Collecting & Auctions