"This is a joint venture with an international company, not an Australian company," said Stellenbosch Vineyards managing director Hermann Böhmer at the conclusion of a joint press conference to announce the groundbreaking new project between themselves and Australia's BRL Hardy.
The conference was held at the plush Raddison Hotel on Cape Town's waterfront to announce the first such joint venture, which will place a new SA-Australian wine brand on the UK market in about four months' time. It will be marketed in Europe through BRL Hardy's comprehensive sales and marketing network.
Stellenbosch Vineyards is a privately owned producer, marketer and bottler of South African wines and BRL Hardy, in turn, the second largest wine company in Australia with production facilities in Australia, New Zealand, the United States and France.
BRL Hardy, last year named Australia's Exporter of the Year, holds major market positions in Australia, the UK, North America, New Zealand and Mainland Europe, as well as having a strong and expanding presence in other major wine markets.
Stephen Millar, MD of BRL Hardy Ltd said the new joint venture would provide:
- An opportunity to establish a quality, value for money, innovative South African brand in the European marketplace;
- A strong start-up position to leverage the growing European interest in South African wine;
- Strong benefits for both parties, with Stellenbosch Vineyards, an industry innovator and visionary producer, combining with the strength of BRL Hardy's sales, marketing and distribution muscle in the European market.
"The new name will be a significant part of our portfolio and it will help explore the opportunities, not only for our own wines, but also for South Africa.
"We will compete with other South African wines on the shelves in Europe, not with our own wines. And having another strong international South African brand could only benefit South Africa."
BRL Hardy's success had shown that an investment in the wine industry could be very profitable for shareholders, Millar added.
Böhmer said the international distributors of other Stellenbosch Vineyards brands were excited about being associated with such a leading wine company.
"It provides us with the leverage we need to gain distribution of wines in Europe. This joint venture builds on and enhances our strengths. We have the vineyard resources and winemaking expertise to produce the best possible wine and our partner has international distribution, sales and marketing impact in the world's key markets ? we are not equal in size, but equal in vision."
Christopher Carson, CEO of BRL Hardy Europe Ltd said, "BRL Hardy currently has three of the top ten selling wine brands in the UK, Hardy's Nottage Hill, Stamp of Australia and Banrock Station, and the addition of a UK and European quality South African brand will enhance the portfolio.
"Given that the South African wine category is growing at 24% year on year in the UK, ahead of the total light wine category of 7%, this joint venture will enable BRL Hardy Europe Ltd to share in this market growth."
"There is no doubt that South Africa has the opportunity to be a major player in many European markets and as is the case with our Australian and New Zealand brands, we shall be looking to become a key category player in the South African sector," said Carson.
He added that the new brand would be styled to be particular to South Africa, bearing in mind the country's unique position between the old and new worlds.
They had looked at about 15 companies in South Africa and decided that in addition to the potential for the right quality and volumes, there was the right "chemistry as we are both progressive companies".
Stellenbosch Vineyards Limited was formed in 1997 with the merger of a number of wineries in the Stellenbosch region. The company produces around 850 000 cases of wine for the export and domestic markets, sourcing grapes from about 2 000 hectares of vineyards in the prime Stellenbosch region. It has a turnover of R155 million.
Altogether 60% of its production is exported. Its current brands are Genesis, Kumkani, Versus, Welmoed and Helderberg, created under the direction of chief winemaker Chris Kelly from New Zealand.
Asked how he managed to pull this one off, Böhmer said with a grin, "I haven't slept much lately."