Archive for the 'Australian wine' Category

Dressed to swill

A dress made out of wine? Wow, I thought ethanol was a bad fate for the wine glut. But this might be even more, um, creative.

Gary Cass who works at the MicroBe project at the University of Western Australia “noticed that when oxygen got into the vats and turned the wine into vinegar, a slimy, rubbery layer grew on top.” Apparently, Cass saw that and thought “dress!”

The picture to the right shows the “cavewoman” cut of the dress (no word on whether the Goth face paint and wig are also obligatory). “It’s the bacteria that are weaving all these fibers together,” says Cass. “We’re not using any machines, sewing machines and so forth.”

One catch is that it has to be kept wet–wow, wet wine waste dress contests! Just in time for spring break…

“News in Science: Bugs make dress smell like old wine” []

tags: | |

Bidding against oneself

Brian Finn, chairman of Australia’s embattled Southcorp, has issued a letter to shareholders stating that “Foster’s offer of A$4.17 may be just its opening bid.” The Foster’s bid values all of Southcorp at A$3.1 billion ($2.35 billion).

Yet with no other suitor yet emerging, Foster’s controlling 18.8% of Southcorp shares, and Foster’s shares taking a licking in the stock market for fears of overpaying, it’s not clear how Finn hopes to rally resistance to the takeover.

Given that Southcorp barely eked out a profit in the first half of this fiscal year after a A$929 million ($709 million) loss last year, Finn is not bargaining from a position of strength. The combined company would control a third of the Australian wine market, produce Penfold’s, the country’s most expensive wine, as well as the biggest beer, Victoria Bitter.

Will Foster’s raise its A$4.17 per share offer price to meet the market’s 6.5% premium with Southcorp’s shares trading at A$4.44? It’s hard to see them bidding against themselves. As bitter as the news may be for Finn, maybe he’ll switch from drinking Penfold’s to Victoria Bitter.

The beer hunter

Southcorp, the struggling Australian wine producer, has rejected a A$4.17 a share take over offer from Foster’s, the brewer and wine maker, which values the company at A$3.1 billion ($2.35 billion) as “inadequate and opportunistic.” The market seems to agree having bid up Southcorp’s shares as high as A$4.50.

Has everyone had a little too much Shiraz?!?

Southcorp’s main brands have not been doing well as they have struggled to successfully integrate Rosemount since acquiring it in 2001 and resorted to in-store discounts to move that and some of its other brands. Now they expect multiple bidders?

There are only three other companies that could really be interested: Constellation (US), Diageo (UK), and Allied Domecq (UK). Constellation is unlikely to make a bid. Having already bought BRL Hardy–when the US dollar was much stronger–they already have good exposure to Australia. Further, they just gobbled up Robert Mondavi for $1.36 billion. Better to digest that one first.

Diageo could pay above the Foster’s bid. Formed by the merger of Grand Metropolitan and Guinness, the transaction size would not be big for this maker and distributor of wine, beer, and spirits with nearly $20 billion in annual sales. But given their global reach, would they want to hunt the wounded beast that is Southcorp? Certainly they did trump other bidders in their acquisition of Chalone last month.

Allied Domecq is probably the most likely rival to Foster’s. Their diverse holdings include Maker’s Mark bourbon as well as Dunkin’ Donuts and Baskin Robbins. So with wine in growth mode, if management wanted to add more wine to their portfolio, this is a big opportunity for them to do so. The currency is not such a negative factor as it would be for say Constellation since Allied Domecq is a UK company.

But many investment analysts say that Foster’s bid is a “mistake” and shares of Foster’s have traded down 10% on the news. Citigroup analyst Dawn Oldham in Melbourne values Southcorp at $2.90 a share. Further, a Foster’s acquisition would cannibalize sales of Foster’s existing Australian brands she says.

So the white knight that Southcorp’s chairman Brian Finn and the markets are anticipating may not arrive. The other big players may bet that Foster’s will drown in its own Shiraz.

Woop woop, there it is

Two days after acquiring a 19% stake in Southcorp, Foster’s has now made a bid for the whole company offering A$4.17 a share for the whole company, valuing it at A$3.1 billion ($2.35 billion). But Southcorp rejected the bid calling it “inadequate and opportunistic.”

Shares of Southcorp surged 11 percent in anticipation of a rival bid, most likely from Diageo or Constellation, both of whom made acquisitions just last month.

More globalization in the glass.

Southcorp scooped?

In a further sign of consolidation in the wine industry, the ailing Australian producer Southcorp may accept a takeover from the Australian wine and beer group, Foster’s. Southcorp’s brands include Penfold’s, Rosemount, Lindeman’s and Wynn’s. Shares of both companies have halted pending news.

Wizard of Oz: Ben Hammerschlag, Importer of Fine Australian Wine

Is being a wine importer all fun and no work? Why is the name of a wine’s importer on a label a good indicator of the bottle’s quality? Dr. Vino chats with Ben Hammerschlag of Epicurean Wines about the daily grind (crush?) and becoming a success.

It’s 9:30 PM and his phone rings. Never mind that Ben Hammerschlag has been with distributors and retailers all day or that he and I are dining at Naha, a contemporary chef-owned restaurant in Chicago’s River North. The local distributor on the phone wants to pin down Hammerschlag for the next day’s schedule.

Hammerschlag is likely to find himself very much in demand these days. He has exploded on to the wine scene with his portfolio of big, muscular wines from Australia. Since incorporating only four years ago, he has built his business to impressive levels of sales and quality. Indeed, it has been a hot summer.

In July a New York Times panel rated two of his wines—Mitolo McLaren Vale and Woop Woop—as the best in a Shiraz tasting. And in the August issue of his influential newsletter, Robert Parker bestowed 94 and 98+ point ratings on many of Hammerschlag’s wines, particularly the excellent 2002 vintage.

All this and Hammerschlag is only 31 years old.

Does Parker’s preference for “hedonistic fruit bombs” steer Hammerschlag in that direction of winemaking? Not really. “Parker and I have similar palates,” he says. “If I were doing sweet wines then I would be out of luck. But fortunately he loves Aussie wines (and Rhones).”

With 90% of production concentrated among the 6 biggest producers, consumers could easily be forgiven for thinking that Australia is simply a land of easy-drinking and uninspiring value wines. But there are over 1,000 smaller producers and the entire line of 150 wine labels that Hammerschlag imports comes from these boutique producers. And they are priced accordingly, selling between $20 and $60 retail, mostly through small wine shops. But they have also had good success breaking into the coveted but difficult domain for Australian wines: American restaurants.

Although one of the Epicurean wines, the 2001 Barton Vale Shiraz, appears on the Naha wine list, we skip it since he certainly knows that one. Instead we opt for a 2000 Mt. Difficulty Pinot Noir from neighboring New Zealand’s Central Otago region, reputedly the southernmost vineyard in the world. The Pinot Noir is a good compromise for his scallop starter and wood-grilled quail main course.

Like a celebrity, a top importer is a good local draw. Local distributors like the importer to talk to the retailers. Retailers like the importer to do a tasting for the customers. Restaurants like the importer to talk to the staff. So when the importer comes to town, his-and he is almost always a man-phone is likely to ring.

With only three staff, including a national sales manager, Hammerschlag works constantly. From his base in Seattle, he tracks his wine shipments across the Pacific, monitors the exchange rate with the Australian dollar, and calls producers and distributors. His weekends aren’t for relaxing. They are for doing bureaucratic paperwork. “If it’s not revenue generating, then it doesn’t make it to the top of my list of things to do,” he says.

Getting around the state and local regulations on selling wine constitutes his “biggest headache.” The uneven repeal of Prohibition has resulted in a situation where the American states act more like sovereign states. Thus it is quite an achievement that the Epicurean wines now are available in 31 states. These relationships require constant attention during the business week.

Even the aspect that traveling to Australia to work with producers is draining. Hammerschlag is so focused on his business that he has never even been to Sydney—no winemakers live there. Instead, he flies direct to Melbourne and spends his time in between there and Adelaide, the heart of Australia’s wine growing region. Renting a house for four days on the beach at Margaret River once was noticeable simply because it stood out so much from his usual itinerary.

Hammerschlag make the trip across 12 time zones three times a year for a total of six weeks. Two of the trips are only 10 days long and are particularly draining: just as he starts to overcome the jet lag, it is time to return. But more draining are perhaps the activities. After working with producers by day, tasting and blending wines, a dinner follows—with wine—and then more talk of business. New contacts are often made at dinner, which require further following-up during the day.

These on-the-ground networks prove essential for finding new wineries to work with. “If they are interested in me, I’m probably not interested in them,” he says. Quality is the m.o. here and he has an exacting palate.

Hammerschlag credits his success with his six years as a wine buyer for a high-end grocery store in Seattle. Although he was “paid the same as the baggers” the experience there was invaluable. Not only did he order a lot of wine, he got to work with consumers. He observed what they liked both in terms of taste and the packaging. This helps him steer the Australian producers to blend wines for the US market as well as have eye-catching labels and packaging. This experience gives him an edge over other importers who often are far removed from the end consumer.

Woop Woop is one such example. With an expensive portfolio of wines, Hammerschlag sought a good value wine to offer distributors and restaurateurs a full range of wines at all price points. Woop Woop, which retails for around $11 in the US, is a fruit-forward Shiraz with a striking sunset photo on the label (and a trendy screwcap on top of the white wine version). The box for a case of Woop Woop-and there are 22,000 of those a year-is covered with uses of this local expression, which in local parlance means “the middle of nowhere.”

Hammerschlag thinks that retail price points matter and wants those not to change-even at the cost of his own profits. In a move that is unusual for an importer, currency fluctuations have eaten into his profits. Although revenues have doubled over the past two years, the decline in the greenback versus the Australian dollar has kept net profits relatively flat. Importers normally pass on currency fluctuations to the distributor, the retailer and ultimately the consumer.

Many challenges lie ahead. He plows all his profits back into the business as it expands. Since profits are not necessarily what motivate him what is it that keeps him going? “I want to be the best.” His is a name wine consumers should seek out since he is not resting on his laurels—or riding off into the Woop Woop!


Wine Maps

Recent Comments

Recent Posts

See my op-eds in the NYT
"Drink Outside the Box"
"Red, White, and Green"


Monthly Archives


Blog posts via email



Wine industry jobs


One of the “fresh voices taking wine journalism in new and important directions.” -World of Fine Wine

“His reporting over the past six months has had seismic consequences, which is a hell of an accomplishment for a blog.”

"News of such activities, reported last month on a wine blog called Dr. Vino, have captivated wine enthusiasts and triggered a fierce online debate…" The Wall Street Journal

"...well-written, well-researched, calm and, dare we use the word, sober." -Dorothy Gaiter & John Brecher, WSJ

jbf07James Beard Foundation awards

Saveur, best drinks blog, finalist 2012.

Winner, Best Wine Blog

One of the "seven best wine blogs." Food & Wine,

One of the three best wine blogs, Fast Company

See more media...


Wine books on Amazon: