S AFRICA: Winecorp poised for consolidation merger
Winecorp has announced plans to merge with Cape Coastal Vintners/Strategy Partners. The two companies said today (10 February) that they have entered into a Heads of Agreement.
Winecorp CEO, Vernon Davis, confirmed that a 90-day due diligence process was underway and, should a final agreement be reached, the value and strategic arrangements would be announced.
It is a complex arrangement due to the wide range of interests represented - especially with regard to CCV. Besides the venture capital and management provided by Strategy Partners, there are five large cellars from the Paarl, Wellington and Swartland areas that are partners, as well as a consortium of black economic empowerment partners.
Some of the cellars involved also have their own brands, which compete both locally and internationally with those of CCV and Winecorp. These include Boland Cellars and Riebeek Cellars. These wineries also in turn have large numbers of shareholders/members to complicate matters further.
"This process began two years ago when Winecorp Limited was de-listed and merged with Winecorp Holdings in a drive to maximise shareholder value," said Davis. "We are now in a position to realise our vision to act as catalysts for consolidation in the SA wine industry."
CCV and Strategy Partners chairman, Johann Pieterse confirmed that the two companies were also involved in discussions regarding joint distribution of both parties' brands locally and internationally.
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