Bulking up
Constellation, the world’s largest wine producer, continues its acquisitive strategy with the announcement today of a $900 million unsolicited buyout offer for Vincor, Canada’s largest winemaker.
Constellation digested Robert Mondavi last year for about $1.1 billion but the Fairport, NY based company did not snare either Southcorp or the juicy bits of Pernod-Ricard earlier this year. Vincor rejected Constellation’s C$31 per share cash offer, a 32% premium over Tuesday’s closing price, calling it “opportunistic and inadequate” according to Bloomberg News. Constellation’s shares lost $1.33, or 5.2 percent, to $24.23 in early trading.
What does this mean for American consumers? Not a great deal but it does underscore the trend toward consolidation continues in the wine world.
For Canadian consumers, Jancis Robinson writes on her web site today that she hopes it will be an opportunity to instill greater truth in wine labeling.
On September 28th, 2005 at 1:59 pm ,NoBullGrape wrote:
While the behavior mentioned in the letter to Janis Robinson is appalling, I’d be surprised if Constellation ever would be the driver for truth-in-labeling laws. These are the guys who call Tott’s Sparkling Wine “Champagne”… certainly nothing close to truth on that label.
On September 28th, 2005 at 2:13 pm ,Dr. Vino wrote:
Yes, it does seem like a bit of a stretch. But I hadn’t realized Canadian wine label laws were not more strict.
Btw, the Europeans are not happy with the recent accord on place names.
New Wine Accord ‘absurd’: Paillard 9/19/05
http://www.decanter.com/news/68703.html
European MPs and Winemakers–all against the accord 9/27/05 (in Spanish)
http://elmundovino.elmundo.es/elmundovino/noticia.html?vi_seccion=12&vs_fecha=200509&vs_noticia=1127845860