As part of the purchase, Buena Vista's owners, the Racke family of Germany, will also give up 983 acres of prime Carneros real estate, about 718 acres of which are already planted to vineyards.
Allied Domecq spokesman George Rose said, "There's tremendous equity in the historical significance of Buena Vista. We have no plans to make any changes for the time being, at least through harvest."
Founded in 1857 by wine pioneer Agoston Haraszthy, Buena Vista was the first bonded winery in California. The Rackes bought Buena Vista in 1979, and while it produced some good quality wines, its overall quality was inconsistent.
Allied Domecq's main goal in purchasing Buena Vista is to gain control of Carneros vineyards, one source said. Those grapes could be used to expand production of several Allied Domecq wines, including Clos du Bois in Sonoma County and Atlas Peak Vineyards and William Hill Winery in Napa Valley.
The sale is the latest in the flurry of winery deals that began in July 1998 with Fortune Brands' purchase of Geyser Peak Winery for $101 million. Other high-profile purchases include Constellation Brands' April buyout of Ravenswood Winery for $148 million and its 1999 acquisition of Simi Winery for $55 million. In 2000, Robert Mondavi Winery paid $45 million for Arrowood Winery and Kendall-Jackson founder Jess Jackson spent $45 million to add Matanzas Creek to his Jackson Family Farms portfolio.
Allied Domecq, one of the largest wine and spirits producers in the world, is routinely cited as a potential suitor in rumored winery sales. Last year, the company considered purchasing Seagram's wine holdings, but instead paid $508 million for two Champagne houses: G.H. Mumm and Perrier-Jouët. It's also involved in a high-profile battle with brewer Lion Nathan to gain control of New Zealand wine giant The Montana Group.
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