Accolade Wines, Australia’s second largest wine producer, is currently in negotiations with Pernod Ricard, the world’s second-largest wine and spirits producer, concerning the sale of some of its assets.
The sale currently being discussed, first reported by Australian Financial Review’s Street Talk, is expected to be worth around $500 million.
“Street Talk understands Accolade Wines, Australia’s second-largest wine group, is seeking to agree terms with the Paris-listed winemaker to pick up its Australian assets, which could fetch a price tag of about $500 million,” read the story.
According to The Australian, the discussions with Pernod Ricard are not related to the ongoing discussions with Australian Vintage and instead are part of a “dual-track process” for the company.
News about a potential merger between Accolade Wines and Australian Vintage first emerged publicly towards the end of February. These discussions are described in AVG’s most recent ASX announcement as ongoing.
While the timing of the news, which falls shortly after Australian Vintage CEO Craig Garvin was fired for misconduct on 3 May, will likely raise some industry suspicion, AVG made clear at the time that the CEO change would not impact the potential merger discussions.
“The departure of Mr Garvin should have no impact on the preliminary discussions between AVG and Accolade Wines on a potential transaction, as previously disclosed to the ASX on 26 February 2024,” read Australian Vintage’s May 3 ASX announcement.
“These discussions are continuing, although there remains no certainty that any transaction will eventuate.”
Both Accolade and Australian Vintage have been feeling the strains of Australia’s ongoing wine crisis. Accolade Wines recently put forth a $4,000 per hectare buyout offer to its Riverland grape growers, and last week Australian Vintage Ltd cancelled a lease on a Riverina vineyard seven years ahead of its scheduled expiry date.
Financial pressures first took hold of Accolade back at the beginning of February when a recapitalisaiton plan saw Australian Wine Holdco Limited assume equity ownership in order to improve the financial stability of the company.
More information about Accolade Wines movements is expected to be made publicly available soon.
