Constellation acquires minority stake in Booker Vineyard

Constellation Brands has acquired a minority stake in Booker Vineyard, based in Paso Robles, in an agreement which could see it become the majority owner in the future.

The agreement sees Constellation invest in Booker’s premium, direct-to-consumer (DTC) portfolio of wines, but also help it to expand wholesale distribution of its Cabernet Sauvignon-dominant label My Favourite Neighbor and Harvey & Harriet wines in the US.

Founded in 2005, Booker champions Rhône varieties, with wines priced between US$30 and US$165 per bottle and sold DTC and through its wine club.

Its My Favorite Neighbor label, named in honour of Stephan Asseo of L’Aventure, was initially made exclusively from grapes grown on the Booker estate, however from 2016, it was expanded. The label comprises a range of wines including Harvey & Harriet, named after founder Eric Jensen’s parents.

According to the statement, Jensen will continue to lead the Booker Vineyard team following Constellation’s investment. The financial terms of the deal were not disclosed.

Robert Hanson, president of wine and spirits at Constellation Brands, said: “Eric Jensen and the Booker Vineyards team have built an exceptionally high-quality collection of Rhône-varietal wines from the Paso Robles AVA. They have done so while building an impressive DTC business with an exciting runway for growth, which aligns with our long-term aspirations to lead the category in DTC and 3-tier eCommerce.

“We will also look to gain insight from Eric’s farming and winemaking approach, along with the expertise of Constellation’s acclaimed master winemakers, as we continue to strengthen our fine wine portfolio. We look forward to working closely with the Booker Vineyard team to help them strategically expand their distribution and build their My Favorite Neighbor and Harvey & Harriet brands with consumers, while leveraging their unique expertise and capabilities to accelerate our leadership.”

While not officially certified, Booker draws on organic and biodynamic farming methods to manage its vineyard.

Eric Jensen, Booker Vineyard’s founder and winemaker, added: “I couldn’t be more excited. Together with Constellation, we’re going to bring the best wines from Paso Robles to American consumers while flipping the traditional fine wine experience on its head. I am a farmer and a winemaker at heart, and I have known for some time that I need a strategic partner that shares my values and brings something to the table that I don’t.

“Constellation has an amazing, growing fine wine portfolio and works with the best minds in the business. With this partnership, we will reap the benefits of Constellation’s brand building and sales expertise, plus its leading network to help us grow our business in ways I can’t on my own.”

Constellation’s Californian wine portfolio includes Schrader, Robert Mondavi Winery, The Prison Wine Company, Mount Veeder Winery and To Kalon Vineyard Company.

It follows news of the sale of Constellation’s brandy label Paul Masson to Sazerac for US$255 million in June. The drinks group has also committed to investing US$100 million in black and minority-owned drinks companies over the next 10 years.

Last month, the company announced it had acquired Gary Vaynerchuk’s direct-to-consumer company, Empathy Wines and sold its grape juice concentrate business, including the Mega Purple brand, to bulk grape juice supplier Vie-Del Company.

Constellation is also in the process of negotiating a US$1.1 billion sale of a selection of its wine brands priced below US$11 a bottle to E&J Gallo. In a separate, but related, deal, it is also selling New Zealand wine brand Nobilo to E&J Gallo.

The New Zealand Overseas Investment Office has subsequently given its consent for the transaction to take place.