Accolade Wines sold for a billion dollars
Multinational investment group Carlyle has purchased Hardys and Echo Falls supplier Accolade Wines for a billion Australian dollars (£422 million).
Accolade one of the biggest producers in Australia and it has several leading brands spread across the New World, including Kumala and Mud House.
It is the fifth largest producer in the world by volume, but it is the largest supplier of wine to the UK off-trade.
Accolade was previously owned by Champ Private Equity, which had an 80% share, and US distributor Constellation Brands.
Champ paid AUS$290 million for its stake in 2011, so it will gain a significant return on its investment.
“Accolade represents the best of private equity ownership: taking the time to develop a business, investing in multiple areas of the business and orientating the company towards a growth opportunity that has many years ahead of it,” said Champ chief executive John Haddock.
Carlyle represents US$195 billion of assets in a broad range of industries. It said in a statement: “This is a company with great brands and strong market positions, with multiple growth opportunities, particularly in Asian markets.
“We look forward to supporting Accolade Wines with Carlyle’s global resources, and investing in the business and working with staff, suppliers and customers to drive growth.”
Analysts described Carlyle’s investment as a “smart move”.
Jonathan Buxton, partner at Cavendish Corporate Finance, said: “Carlyle’s acquisition of Accolade is a smart move to capitalise on the rapidly increasing demand for Australian wines among the Chinese middle classes.
“Wine exports from Australia to China surged by 63% last year and Accoldae expects to see an 80% rise in its own exports to China in 2018. Largely this is the result of the free-trade agreement signed between the countries a few years ago, which has seen tariffs on Australian wine cut significantly.
“The acquisition provides Carlyle with exposure to this highly lucrative and fast-growing segment of the market and will help strengthen its foothold in China. With the growing possibility of trade tariffs between the US and China, we expect demand for Australian wines in Asia to increase further as exports from the US are likely to be hit. Accolade is perfectly positioned to benefit from this. We anticipate further M&A activity involving branded goods from companies and PE houses seeking to take advantage of the increasing wealth and opportunities among Chinese consumers.”