Australian retail giant buys Summergate

One of China’s major wine importers, Summergate Fine Wines & Spirits, and its retail subsidiary Pudao Wines have been bought by Australian drinks retail giant Woolworth’s Liquor Group.

The deal marks the combination of Summergate’s Chinese market network and high quality wine and spirit agency portfolio, which includes producers such as Domaine Armand Rousseau, Hugel & Fils, Ridge Vineyards and Dominio de Pingus, with the retail scale offered by WLG, part of Australian supermarket group Woolworths.

Summergate founders Ian Ford and Brendan O’Toole, will stay on as directors, with Ford also remaining in place as CEO. The pair, a former Seagram employee from the US and a management consultant from New Zealand, set up Summergate in 1999 and have since expanded its presence to 13 offices across major Chinese cities, as well as Macau and Hong Kong.

The company has more recently extended its focus into retail with the establishment in 2009 of Pudao Wines, which operates in Beijing and Shanghai, as well as the launch earlier this year of an online arm in Hong Kong.

Following its acquisition by WLG, Summergate and Pudao join a Woolworths group retail portfolio that already covers over 3,000 stores across Australia and New Zealand, including the Dan Murphy’s liquor chain and The Wine Quarter, a collective of digital and direct-to consumer drinks specialists.

Announcing the deal, Ford remarked: “Of the many companies that we have spoken to during the process of seeking capital for growth, Woolworths Liquor Group is by far the best fit for our business and our team, with a shared vision and values and fantastic synergies. We share a long-term view on future opportunities and have the resources, expertise and systems to support accelerated growth.”

WLG managing director Brad Banducci echoed this comment about the future Chinese growth opportunities created for both parties by the acquisition, saying: “WLG is excited by the opportunity to invest in the fastest growing wine market in the world. Brendan and Ian have built the business from a start-up in 1999 to one of the leading fine wine distributors in the region.

“They have extensive knowledge and experience in the region’s drinks market and we are thrilled to make this investment to help support and grow Summergate even further.”