LVMH Sells Simi to Canandaigua for $55 Million
Dana Nigro
Posted: April 2, 1999
Simi is about to join Canandaigua Brands. The New York beverage giant has signed a definitive agreement to purchase historic Simi Winery in Sonoma County, an acquisition that will give Canandaigua a high-profile, ultrapremium winery to add to its lineup.
Dan Barnett, president and CEO of Canandaigua Wine Company, confirmed that the group is buying Simi's winery, wine inventory and Sonoma vineyards, plus worldwide rights to the brand name, from the French luxury goods conglomerate LVMH Moet-Hennessy Louis Vuitton. "We've been looking for an ultrapremium winery for quite some time," said Barnett. "We jumped at the chance when it became available." Canandaigua is best known for its inexpensive wines.
According to Barnett, Simi winemaker Nick Goldschmidt has agreed to remain for several years and oversee the transition. The winery will be overseen by Bill Newlands, currently vice president and general manager of Canandaigua's table wine business. He had been president and CEO of Simi and Domaine Chandon, but resigned last December. "There will be continuity in management," commented Barnett.
Barnett would not disclose the purchase price, but another source familiar with the details said that Canandaigua paid about $55 million.
LVMH had been soliciting bids for Simi since late last year; the company said it had decided to sell the winery, best known for its Cabernet Sauvignon and Chardonnay, to focus on production and sales of Champagne and sparkling wine. LVMH's many holdings include Moet & Chandon in France and Domaine Chandon in Napa Valley.
Simi, founded in Healdsburg, Calif., in 1876, was purchased by LVMH in 1981. The winery owns more than 300 acres of vines in Sonoma County, makes 175,000 cases annually and has earned outstanding ratings from Wine Spectator critics for many of its Cabernets and Chardonnays.
"Our plans are to let the winery keep doing what it does best, which is making great wines," said Barnett, adding that there are no plans to increase production or change the marketing of the brand. "We plan to let them keep moving toward their own objectives."
Canandaigua Brands, headquartered in New York's Finger Lakes region, produces and markets wine, beer and distilled sprits in the United States and United Kingdom. Though widely known for its jug wines, such as Almaden and Paul Masson, the company has been trying to redefine its image with higher-quality California varietals, and the acquisition of Simi should help achieve this goal. The company's wine portfolio also includes the new Arbor Mist fruit-flavored wines, Cook's, Dunnewood, Estate Cellars, Marcus James, Manischewitz, Mystic Cliffs, Wild Irish Rose and Vina Santa Carolina.
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Canandaigua May Be Simi's Favored SuitorMonday, March 8, 1999
Former Simi, Chandon CEO Moves to CanandaiguaFebruary 8, 1999
Unfiltered, Unfined: New Twist on Confusing LabelsDecember 4, 1998
California's Simi Winery May be SoldFebruary 29, 1996
Simi Goes Back to Its RootsOther recent Sonoma winery sales:
February 11, 1999
California's Sonoma-Cutrer Sells Majority Stake To Brown-FormanJuly 23, 1998
Sonoma's Geyser Peak Winery Sold for $100 Million
