US: Treasury Wine Estates, Accolade Wines agree US deal
TWE has agreed a deal with Accolade in the US
Treasury Wine Estates (TWE) has signed a deal to package and produce supplies in the US for its rival Accolade Wines.
Under the agreement, TWE will contract package Accolade’s wines at its Napa Bottling Centre and produce the other company's stock at its Asti winery. Melbourne-headquartered TWE said the "multi-year" packaging contract starts this month, while production at Asti will begin with the 2014 vintage.
Financial details of the deal were not revealed.
Stuart McNab, TWE’s chief supply officer, said the move would help the group “win in the Americas”.
He added: “This is a great outcome for both parties. TWE’s increased focus on maximising efficiencies in our global supply network has enabled us to leverage spare capacity and generate additional financial returns for our US operations.”
TWE is currently facing two lawsuits over allegations involving its business practices in the US. In July, the group announced that it was destroying its old and out-of-date stock in the US, resulting in a writedown of AUD160m (US$145.7m).
The company parted company with its CEO David Dearie earlier this year, following the writedown.
The latest developement is not the first partnership the two companies have agreed. Last year, the groups struck a deal that sees TWE bottle Accolade's wines in Australia, while Accolade does the same for TWE in the UK.
To read an exclusive just-drinks interview with the head of Accolade's US unit, click here
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