Nelson winery in talks over sale

The owners of Nelson winery Waimea Estates are negotiating its sale to United States-based investment firm Saint James Company, but an agreement is "still a few months off", according to one of the winery's owners, Trevor Bolitho.

St James president Wayne Gronquist was reported yesterday as saying that his company "has entered into an agreement to acquire the capital stock or assets" of Waimea Estates.

Mr Gronquist stated that the company was also acquiring two Marlborough wineries, Lawson's Dry Hills and Gravitas Wines.

However, Mr Bolitho said the announcement by Saint James was "a surprise" and any sale was "still a few months off".

A sale would also have to be approved by the Overseas Investment Commission, he said.

"We have been in negotiations with Saint James, and there's a process we have to go through. But we still have a few hurdles to get over before we agree on anything the announcement is definitely premature."

Mr Bolitho refused to reveal any details of the negotiations but said the sale would "be beneficial to our business".

Waimea Estates is a family-owned vineyard and winery founded in 1993. It has 130 hectares of grapes planted on the Waimea Plains and a winery just south of Richmond.

Mr Gronquist said yesterday that the three wineries and vineyards "represent world-class wine estates that have cumulatively won an impressive number of trophies and gold medals honouring their excellence".

"The New Zealand wine industry has demonstrated dramatic growth and increasing global demand for their products, while maintaining strong price points and net margins.

"The Saint James Company expects to generate substantial revenues from this portfolio once we begin to import these wines into the United States and United Kingdom," Mr Gronquist said.

New Zealand Winegrowers chief executive Philip Gregan said today he didn't know anything about the St James Company's negotiations with Waimea Estates, although successful New Zealand wineries were always an attractive investment for overseas buyers.

Mr Gregan said he viewed overseas investment in the industry as "a positive, because it says we are successful in the global market".

The benefits of selling to an overseas buyer included capital investment for further development, and tapping into vast distribution networks.

Montana Wines was bought by Allied Domecq in 2001, only to be snapped up by Pernod Ricard four years later.

Global player Constellation Brands has expanded into New Zealand, acquiring Nobilo, Selaks and Kim Crawford.

"When Kim Crawford was sold, it gave them some really big distribution power," Mr Gregan said.

The Nelson Mail understands that Lawson's Dry Hills is also still negotiating with Saint James, although an agreement could be reached by the end of the month.

- © Fairfax NZ News