Australian wine firms announce merger

Australian producers Wine Insights and Cumulus Wines have merged to “capitalise on changing market and sector conditions and emerging market opportunities.”

The merger brings together brands including Rolling and Climbing from New South Wales, Moss Bros from Margaret River, The Riddoch Run from Coonawarra and multi-regional brands Beelgara Estate and The Habitat. It creates a combined gross revenue of AUD$20 million (£9.6m) with sales of over 400,000 cases of wine across 27 markets.

Describing itself as a “total wine services provider”, in addition to producing its own brands, Wine Insights provides third party winemaking, storage, bottling and brand development services that make it a major player in Australia’s bulk wine sector.

Cumulus Wines was founded during the 1980s, with the company’s 508 hectares making it the largest producer in the Orange and Central Ranges of New South Wales. It currently exports 40% of its production to a distribution network that spans 20 countries.

The two sides confirmed that Wine Insights brands will now be produced at Cumulus Wines’ state-of-the-art winery at Cudal, which has the capacity to process 10,000 tonnes of grapes during vintage and store 8m litres of wine.

The deal, which involved an exchange of shares rather than cash, will see each of the brands continue to be managed autonomously, with no change to their current sales and distribution structures nor partnerships in export markets.

“We are very excited to continue the evolution of our business through this merged entity,” commented Peter Toohey, managing director of Wine Insights. “In a rapidly changing industry, companies must ensure they are profitable, relevant, efficient, and produce high quality wines. Most importantly, operations must be aligned to changing market conditions and consumer preferences. We believe the merger improves our ability to do so.”

Describing the new entity as “well placed to capitalise on changing market and sector conditions and emerging market opportunities”, Peter Wedgewood, chairman of Cumulus Wines, observed: “The merger enables us to navigate the future with operational and financial stability.”