Chilean winery Vina Montes will invest around US$2m in expanding production into neighbouring Argentina and is also looking at boosting its production capacity in Chile.

Vina Montes produced 460,000 cases last year and sales to date in 2005 are already 20% higher than in the same period of 2004, making the company Chile's sixth most important wine exporter.

The winery is now coming close to capacity constraints and is looking at building new production facilities in Chile as well as expanding into Argentina, where it will purchase and plant around 70 hectares.

Vina Montes has not yet decided whether it will finance the expansion plans via a share or bond issue or by bringing in a partner.