NZ wine company bought by US investors

 A Marlborough-based wine company, the New Zealand Wine Fund, has been bought by a United States-based wine company.

California-based Foley Family Wines has entered into an agreement with the New Zealand Wine Fund to buy the whole company, which includes Vavasour, Goldwater, Clifford Bay, Boatshed Bay, Dashwood and Redwood Pass.

Vavasour Wine Company managing director Peter Scutts said the agreement included the sale of 100 hectares of vineyard, of which 80 per cent is sauvignon blanc.

Mr Scutts said the sale of the New Zealand Wine Fund to the Sonoma-based wine company, which was established in 1996, was subject to clearance by the New Zealand Overseas Investment Office.

The agreement was signed on July 31 and investors were informed late last week of the decision.

Mr Scutts said the company produced 280,000 cases of wine but had planned to expand to 350,000 cases within the next few years.

"It wouldn't surprise me if he wanted to grow that company beyond that number."

Mr Scutts said that while the company was not necessarily looking to sell it came at a time when some of the major investors were looking to potentially sell.

He said company owner Bill Foley had approached the fund and made a good offer.

Mr Foley had a distribution network in the United States which would be a huge benefit to the wineries in the future, Mr Scutts said.

Mr Foley founded his company in 1996 and with acquisitions of other wineries it now produces nearly half a million cases a year. The fund will be its first overseas acquisition.

About 100 hectares of vineyards 85 per cent sauvignon blanc are included in the deal.

Altogether, the fund produces about 280,000 cases a year.

New Zealand Winegrowers chief executive Philip Gregan said the sale meant that nearly half of the country's wine production was now in the hands of overseas-owned companies. "We take foreign investment as a sign of marketplace success for New Zealand wines," he said. "It means we're successful and people want to be part of it."

New Zealand Winegrowers chairman Stuart Smith said overseas investment was a good thing for the New Zealand wine industry because the investing companies came with their own distribution channels.

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