Canadian giant Vincor International, which already owns wineries in California, Washington, Australia and New Zealand, has bought a privately held British firm, Western Wines, owner of Kumala, the biggest-selling South African brand in the United Kingdom. The purchase price was nearly US$243 million, which includes US$89.5 million in assumed debt.
"It gives us a major position in the second-largest market in the world," said Vincor president and CEO Donald Triggs, "and provides us the opportunity to accelerate our growth in northern Europe."
Western Wines, established in 1980, has grown to become the United Kingdom's largest independent wine importer, marketer and distributor, with sales projected to reach 6.4 million cases this year. It has offices in Shropshire, England, and Stellenbosch, South Africa. The company's extensive wine portfolio encompasses about 400 labels that it owns, represents, or produces exclusively as retailers' private labels.
Kumala, created in 1995, had sales of 2.4 million cases in the United Kingdom this year. The wines, produced in the Western Cape region, consist of five lines -- Dual Variety, Organic, Reserve, Winemaker's Selection and a Single Vineyard series -- ranging in price from about US$5 to US$30. Western Wines also distributes the United Kingdom's best-selling Chilean brand, Cono Sur, and is the third-largest U.K. importer of Italian wines.
Using its North American distribution network, Vincor will introduce Kumala wines into the U.S. market sometime next year. "Although the United Kingdom is an important market for New World wines, the U.S. has more than double the potential," Triggs said. "It still holds the central position in our sightlines."
Vincor will also introduce its existing wine portfolio into the United Kingdom, and Western Wines founder Roger Gabb and the management team will stay on for the next four years to oversee the distribution of those brands.
In Canada, Vincor owns wineries in British Columbia, Ontario, Quebec and New Brunswick, with a portfolio of brands that includes Ancient Coast, Hawthorne Mountain, Inniskillin, Jackson-Triggs, Sawmill Creek and Sumac Ridge. It also has joint ventures in Ontario with the Boisset family of Burgundy and in British Columbia with Groupe Taillan of Bordeaux. Internationally, it owns brands such as R.H. Phillips in California, Hogue Cellars in Washington, Kim Crawford in New Zealand and Amberley Wines and Goundrey Wines in Australia.