DGB, one of South Africa's leading wine and spirits companies is in discussions with the owners of Boschendal to acquire the brand, winery and tasting facility near Paarl.

DGB's MD, Tim Hutchinson, confirmed that his company had entered negotiations, but said that there should be more clarity on the outcome after further discussions in early March.

The deal does not include the vineyards or the proposed gentleman's estate being created on the 344-hectare property at present.

Boschendal markets between 230,000 and 250,000 9-litre cases of wine a year. Speculation in the industry is that the deal is worth about R100m, but this could not be confirmed.

This proposed acquisition would fit in neatly with Hutchinson's stated intention of building DGB into a 4 to 5m case liquor company in the next few years.

The Boschendal estate was purchased in 2003 by a Luxembourg-registered consortium, Citation Holdings.

A 30% stake was hived off to Kovac, a black economic empowerment group in South Africa.

Hutchinson confirmed that DGB had concluded a distribution agreement with Boschendal for the domestic market, which came into operation in January.