The financially troubled Australian wine brand Reynolds has been acquired by Trinchero Family Estates, the Napa Valley company that produces Sutter Home, Montevina and other labels.
The price tag on the deal was not disclosed. Trinchero had been marketing and distributing Reynolds wines since December 2000. "This is a really great move for us," said company president Roger Trinchero. "It's a good fit in our portfolio."
Reynolds is based in the Orange area of New South Wales. It produces two tiers of wines, priced between $7 and $12 in the United States, which include Cabernet Sauvignon, Merlot, Shiraz, Chardonnay and Sauvignon Blanc.
Reynolds' financial troubles began a year ago when the Australian Tax Office ruled that the publicly held company owed AU $18 million (currently about US $13.9 million). The company, formerly called Cabonne Limited, filed bankruptcy and went into liquidation in November.
Trinchero acquires the Reynolds brand and a second label, Little Boomey, which is sold exclusively in Canada. Newco, the company that is currently managing the Reynolds assets, retains distribution rights in the United Kingdom. Reynolds vineyards and winery in Orange, which are not part of the deal, are expected to be sold to another wine company, Trinchero said.
"I'm not interested in owning a winery in Australia," Trinchero said. "But Australia is still a very hot category, and we like having a presence there."
Reynolds currently sells about 75,000 cases a year and uses grape sources in Orange and other areas of New South Wales. "We hope to grow production considerably," Trinchero said, "and in the next few years, you may see some new products coming out, with new grape sources, but it will continue to be an Australian brand."
Trinchero Family Estates was founded in 1947 and is one of the 10 largest wineries in the United States, producing more than 8 million cases a year. In addition to Sutter Home and Montevina, its brands include Trinchero, Trinity Oaks and Fre, an alcohol-free wine.