US: Brown-Forman next to sell wine unit?- report
Will Brown-Forman be the next alcoholic drinks company to offload its wine division?
Brown-Forman has declined to comment on reports that it is close to putting its wine business up for sale.
Citing “people familiar with the matter”, the Wall Street Journal said late yesterday (20 December) that the US-based company has hired Rothschild to run the auction process, but did not provide further details about the move. When contacted by just-drinks, a spokesperson for Brown-Forman said: “It is Brown-Forman policy to not comment on or respond to reports or rumours about acquisitions, divestitures, or financial matters.”
The timing of the speculation coincides with news revealed exclusively by just-drinks yesterday that Constellation Brands is close to divesting its Australian and UK wine divisions.
Among the brands in the firm's wine stable are Fetzer, Bonterra and Sonama-Cutrer. In Brown-Forman's last fiscal year, to the end of April, Fetzer, the company's flagship wine brand, posted a 3% slide in net sales compared to a year earlier, with volumes dipping by 5% to 2.2m nine-litre cases. The firm has managed to weather the economic downturn thanks primarily to its Jack Daniel's whiskey and El Jimador Tequila brands.
Two years ago, Brown-Forman offloaded its Italian wine brands - Bolla and Fontana Candida - to Gruppo Italiano Vini, as part of a strategy to offload peripheral sections of its portfolio. The move left the firm with only Californian brands in its wine portfolio.
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