R300 million merger puts new wine giant on course for long term success

by | Dec 6, 2018 | Blog, Lifestyle, News

Bonnievale Wines

The Bonnievale Wine Cellar Group and Wandsbeck Wines have merged to form a wine company with assets to the value of R300 million. The wine cellars in the Robertson region’s amalgamation forms the foundation of one of the Cape’s largest wine producers, now known as Bonnievale Wine Cellar Pty (Ltd).

The agreement follows discussions between producer members and directors lasting more than 15 months. The decision was confirmed on Thursday (29 November) by a joint vote of the shareholders.

“Wandsbeck Wines is excited to merge with Bonnievale Wine Cellar,” said Wandsbeck chairman Philbert Lourens. “Wandsbeck has great cultivar diversity, a unique style and climate, which will contribute to the group’s goals and achievements.”

He continues: “Wandsbeck’s membership and tonnage has declined over the last few years and it is expected that the larger company will reduce production costs and increase profitability. We aim to create a good economic and sustainable future for our members.”

According to the Bonnievale Wine Cellar Group chairman, Anton Smuts, the changing production and marketing conditions have driven this merger strategy to ensure producer sustainability and profitability, product supply and expansion and long-term market security and future growth.

“The industry will also have to consolidate and regroup – from both a production and a marketing perspective – to bring about long-term sustainability and dynamic progress. This merger also creates a wider footprint for terroir possibilities, which strengthens and expands the current spectrum.”

Smuts says: “The leadership teams of Bonnievale and Wandsbeck has identified the need to create an attractive yet solid platform, which will encourage our grape producers to plant new vineyards and ensure long-term profitability and growth.”

Under the agreement, production will continue at existing facilities – three of the Bonnievale Wine Cellar Group and one at Wandsbeck. Each winery will operate at full capacity, with a winemaker and production team in the cellar.

All of the winemakers will remain in their current positions and will report to the chief winemaker, Marthinus Rademeyer. The management and administrative staff will work from the former Bonnievale Wine Cellar Group offices, which is also home to the trademark hospitality centre and customer service centre for both entities.

Wandsbeck Cellar

The chief executive officer of the Bonnievale Wine Cellar Group, John Barnardt, has been appointed as CEO of Bonnievale Wine Cellar Pty (Ltd).

“The merger is the result of the mutual needs of both organisations, each of which is recognised for high quality and high value wines,” says Barnardt. “Now that the agreement has been ratified, it provides an opportunity to create even greater added value and continued market and customer development.”

“The wine industry has no shortage of buying and selling, wine storage and wage service agreements,” he adds. “In the long run, many of these agreements will be tested by changing production and market conditions. This merger also enables us to combine all our resources, like leadership, management, grape production, wine production, finance and marketing.”

After the merger, the cellar capacity will be at 40 000 tons.

Empowerment remains a major focus at Bonnievale Wine Cellar (Pty) Ltd. This includes a focus on vineyard ownership, driven mainly by free market supply and demand, but with the main focus on existing black-owned farms, increased participation in middle and senior wine cellar management, BEE shareholding in a subsidiary wine marketing company and increased participation in community projects.

Wandsbeck was founded in 1965 and up until 2004, it was known as Agterkliphoogte Koöperatiewe Kelder – named after the area in which it is located. The wine cellar is about 60 km from Bonnievale, halfway between McGregor and Villiersdorp. Its own brand range includes a diverse portfolio of red and white, dry and sweet wines, as well as grape juice.

This is the second merger that the Bonnievale Wine Cellar Group will complete in 12 years. The Bonnievale Wine Cellar Co-operative Ltd. was established in November 2006, following the triple merger of Bonnievale, Merwespont and Nordale co-operative wine cellars.

The continued focus on high quality and high value has recently included the refurbishment of its portfolio and launch of the River Collection series, which has already included a wide range of local and international awards.

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