TWE acquires luxury US winery in strategic move

Treasury Wine Estates has made a big announcement regarding its acquisition of DAOU Vineyards, an acclaimed luxury wine brand based in the United States.

This strategic move underscores TWE's commitment to expanding its luxury wine portfolio, making it a formidable player in the global wine market.

The deal involves an upfront payment of $900 million, with the potential for an additional earn-out of up to $100 million, emphasizing the significant value-creation opportunity that this acquisition presents.

DAOU Vineyards, founded by brothers Georges and Daniel Daou in 2007 and situated in the Paso Robles region of California, has gained recognition as the fastest-growing luxury wine brand in the U.S.

Their remarkable success can be attributed to their award-winning Cabernet Sauvignon-based PATRIMONY wines, a unique consumer profile, and unparalleled luxury experiences.

DAOU's innovative approach is exemplified by its fully integrated digital platform, DAOU+, which combines e-commerce and membership services to enhance consumer loyalty.

The acquisition of DAOU aligns with Treasury Wine Estates' growth strategy, reinforcing its presence in premium and luxury wine segments, both in the United States and globally.

This move positions TWE as a dominant force in the luxury wine sector, leveraging DAOU's strengths to curate a luxury wine portfolio. TWE's extensive global distribution network and consumer expertise will further facilitate the expansion of DAOU's offerings to international markets, ensuring that a broader audience can enjoy the DAOU experience.

Commenting on this transformational acquisition, Tim Ford, CEO of Treasury Wine Estates, said: "The U.S. is the world's largest wine market, and we're beyond thrilled to add DAOU to our portfolio, cementing our position as a global luxury wine leader. With DAOU, we will be well-positioned to connect with a new generation of wine lovers, combining tradition with innovation, culture-led experiences, and global distribution."

Ben Dollard, President of Treasury Americas, emphasized the potential for expanding the wine category's consumer base, particularly among younger wine enthusiasts. He said the acquisition presents an opportunity to take DAOU's successful experience at DAOU Mountain to a global level.

Georges and Daniel Daou, Founders of DAOU said they believe joining forces with TWE will enable them to bring their premium brand to consumers worldwide while maintaining a focus on quality and craftsmanship.

The transaction, expected to be finalized by the end of 2023, is contingent on U.S. anti-trust approval. It includes acquiring the DAOU brand, DAOU Mountain Estate, four boutique luxury wineries, and approximately 400 acres of vineyards in the coveted Adelaida District of Paso Robles.

Importantly, Georges and Daniel Daou will remain actively engaged in the business, with Georges as Founder and Daniel as Founder and DAOU Chief Winemaker.

Treasury Wine Estates' acquisition of DAOU Vineyards positions TWE as a dominant player in the luxury wine market. It enables DAOU to bring its exceptional wines and luxury experiences to a global audience.

This strategic move signifies the evolving landscape of the wine industry and the growing demand for premium and luxury offerings.