GLOBAL: Constellation Europe becomes Accolade Wines

Constellation Wines Australia & Europe has officially changed its name to Accolade Wines, following CHAMP Private Equity's takeover of the business.

Accolade's corporate slogan will be 'to enrich everyday moments around the world', the group said today (27 June). The mission statement underlines the group's global ambitions, amid tough trading conditions in its largest market, the UK.

The group's most immediate challenges are to improve profitability in the UK and expand further into emerging markets, such as Eastern Europe. US-based Constellation Brands has retained a 20% stake in Accolade, which produces Hardys, Kumala and Echo Falls wines.

In Constellation Brands' most recent fiscal year, to the end of February, net sales in its Australia and Europe business fell by 17% to US$775m. On an organic basis and at constant currencies, however, Constellation said that sales were level with the previous year.

Operating profits at the division sank by 45% on the previous year, to US$9.3m. But, there were signs of improvement in the fourth quarter, with operating profits up by 19%.

Privately-held Accolade has retained Troy Christensen as CEO, as well as James Lousada as general manager for the UK and Europe. Lousada said today that the group is outperforming the UK wine market with year-on-year rises in both value and volume sales. "We are aiming to become a forward-thinking company which is agile and responsive," he said.

"The business already has global brands like Hardys, consistently recognised as one of the world’s top five wine brands," he said, adding that Echo Falls "has become a top three UK wine brand in just five years and is growing faster than any other top UK wine brand".

Accolade estimates that it accounts for one in five bottles of wine sold in the UK, equivalent to around 20m cases. That makes it as big as its three nearest competitors - Diageo's Percy Fox, Treasury Wine Estates and E&J Gallo Winery - put together.

Sources close to the company have told just-drinks that relations between CHAMP and Accolade have been progressing well, with CHAMP executives making it clear that money is available for investment.

Earlier this year, CHAMP'S MD, John Haddock, told just-drinks in an exclusive interview: "The assets are in very good condition – Constellation did a good job there. We'll be able to put more time, effort and money behind those assets to redevelop them and grow them further."