Australia's Simon Gilbert Wines has decided to suspend winemaking at its Mudgee winery in New South Wales as it "aggressively integrates" its business with recent acquisition Cassegrain Wines.

Simon Gilbert, which bought Cassegrain in July, had intended for most of the enlarged company's wine production to take place at its Mudgee winery.

However, Simon Gilbert CEO Paul Pacino said today (20 December) that the company has decided to transfer all wine production to the Cassegrain winery in Hastings River after witnessing the "positive results" from the integration of the two businesses since the acquisition.

"Winemaking will be concentrated at Cassegrain winery from 2007 vintage and until capacity at Cassegrain is fully utilised, or wine industry conditions improve sufficiently to warrant recommencing winemaking operations at Simon Gilbert Wines winery in Mudgee," Pacino said.

An unspecified number of jobs has been cut since the integration of Simon Gilbert and Cassegrain began. Cassegrain's owner John Cassegrain, who holds a 30% stake in the enlarged company, became chief winemaker in November.

Pacino said the company might look to lease its operations at Mudgee. He said the benefits of consolidating all the company's winemaking operations at Cassegrain would be "considerable".

Pacino added: "Restructuring and one off adjustment costs, including the planned sale of some older wines in stock into the bulk wine market, will offset the expected benefits over the short term. The benefits from the changes will, however, come through in full from the end of the current operating period."