CHAMP and Constellation Brands have sold Accolade Wines to The Carlyle Group for $1billion.
CHAMP is an 80% shareholder in Accolade, while Constellation is a 20% shareholder. The sale price is more than three times what CHAMP paid when it formed Accolade seven years ago.
A spokesman for CHAMP Private Equity confirmed in February that The Carlyle Group had entered into exclusive discussions to buy Accolade.
The Carlyle Group is a global alternative asset manager with $195 billion of assets under management across 317 investment vehicles. Founded in 1987 in Washington, Carlyle has grown into one of the world’s largest and most successful investment firms, with more than 1600 professionals operating in 31 offices in the United States, South America, Europe, the Middle East, Africa, Asia and Australia.
CHAMP’s Accolade legacy
In early 2011, CHAMP acquired two separate divisions from Constellation for $290 million and began the process of creating Accolade Wines.
CHAMP Private Equity CEO Mr John Haddock said: “We saw an opportunity, but the wine industry has long cycles so we knew we had to commit to a longer hold in order to realise that opportunity.
“The two divisions CHAMP acquired had separate strategies, separate management, operated out of Australia and the UK and were even on separate IT systems. Firstly, we had to bring the two divisions together to create one business.”
More than seven years later, Accolade is the largest producer of Australian wine, exporting to more than 140 countries, and one of the world’s leading wine companies.
“We followed a deliberate strategy of creating a New World wine platform so that we now have wine making operations in Australia, New Zealand, South Africa, the United States and Chile, while also premiumising our local offering through the acquisitions of Grant Burge Wines and the Fine Wine Partners portfolio, which included brands such as St. Hallett, Petaluma and Croser,” Haddock said.
CHAMP has also made significant investment in Accolade’s production facilities and following the completion next year of the new bottling and warehousing facility at Berri in South Australia, the company will have the largest bottling, packaging and distribution centres in both Europe (Accolade Park in the UK) and in the Southern Hemisphere to service all of its key markets.
CHAMP noted in a statement that it is proud of the work undertaken to both rejuvenate core brands like Hardys, which has been making wine for more than 160 years, and growing the brands that have been added to the portfolio.
“I know Sir James and Bill Hardy are very pleased with the renewed trajectory that their family’s heritage brand is taking and since Accolade’s acquisition of Grant Burge, sales have increased by more than 80%.” Haddock said.
“Accolade represents the best of private equity ownership: taking the time to develop a business, investing in multiple areas of the business and orientating the company towards a growth opportunity that has many years ahead of it.”
“CHAMP is proud to have been the custodian of so many widely respected brands, to have contributed to the great Australian wine industry and to have added export value to Australia. We are very pleased that a global firm of such experience and capability as The Carlyle Group will now take Accolade forward,” Haddock said.
Recapitalisation not standing in the way of progress
In January, Accolade Wines announced it was launching Fine Wine Partners in the UK and Ireland.
Accolade acquired the premium wine business from Lion Australia in 2016 as part of its “strategy as the leading provider of New World wine”
Fine Wine Partners is focussed on iconic, regionally distinct varietals in premium growing regions and brands included in the Lion deal included labels such as Petaluma, Croser, St Hallett, Knappstein, Stonier and Tatachilla; while the Accolade portfolio also features brands such as Houghton, Grant Burge, House of Arras and Hardy’s.
Ade McKeon, general manager UK and Ireland for Accolade Wines, said: “Accolade Wines has always had a strong culture of fine wines and winery ownership which complement our leading portfolio of branded wines. The acquisition of Lion Nathan’s Fine Wine division a year ago has reinforced and strengthened our offer and we are committed to its growth for the long term.”
Toby Spiers, previously the Fine Wine Business Manager at Treasury Wine Estates, has been appointed to head up Fine Wine Partners UK.
Spiers noted: “We have redefined our approach to the sales and marketing of our premium wines for the UK market to be aimed at specialist, prestige and independent accounts in the off and on trade. Our portfolio is a flagship for fine wines from the New World in terms of quality and breadth with some of the rarest and most collectible benchmark wines for their given style, especially looking at our Australian category.
“Australia is comparable to the size of Europe so we should not generalise about its wines with so many climatic influences and soil types, let alone winemaking style or philosophy. We believe the regional story of Australian fine wine needs to be retold and reinforced as we feel not enough has been done in recent times. We have the ambition, wines and a commercial plan to be a leading force behind this long-term effort.”
Drinks Bulletin 5/04/18