Second offer for Treasury Wine Estates

Australia’s Treasury Wine Estates (TWE) has received a second multi-billion-dollar offer, sparking a bidding war for ownership of the troubled wine company.

The offer, from an as yet unnamed global private equity firm, is to acquire all of the shares of TWE at AUS$5.20 cash per share, the same as what US equity firm KKR offered earlier this month. 

It would represent a deal worth AUS$3.4bn (£1.88bn; $3.17bn).

Earlier this month, the US private equity giant KKR launched a renewed bid for the winemaker after its first offer was rejected.

Treasury Wine Estates, which is behind brands including Penfolds, Wolf Blass and other leading Australian brands, has been struggling for sometime and recently announced an impairment of over AU$200 million from its assets.

In a statement released on Sunday, Treasury Wine Estates said: “The Board of TWE has concluded that it is in the interests of its shareholders to engage further with this private equity investor. Therefore, subject to the negotiation of an appropriate confidentiality agreement, it will also be granted the opportunity to conduct non-exclusive due diligence.

“The proposal is subject to due diligence and conditional on a number of other matters equivalent to the previously announced proposal. The Board of TWE reiterates that there is no certainty that any proposal will result in an offer for the Company. As previously stated, if an offer does result, the Board will assess whether it delivers a value proposition that is superior to the expected benefits from Management’s renewed strategic plans.”

UPDATE 12/09/2014: The second bidder has now been named asTPG Capital, a  private investment firm based in Texas, US.