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Constellation Sells its Wine Businesses
A selling spree is taking the wine world by storm it seems. Constellation Brands has sold its wine businesses in Australia, the UK and South Africa to a private equity company in a deal worth A$290m.
According to a decanter.com report, Sydney-based CHAMP Private Equity will buy 80% of Constellation Wines Australia and Europe (CWAE) for A$230m under the terms of the deal, including high-profile brands like Hardys and Kumala.
The price of the acquisition is in stark contrast to the A$1.9bn Constellation paid for the BRL Hardy wine business in 2003.
“The CWAE business sells quality wines from the important Australian appellation and has significant scale, but continues to be faced with challenging market conditions,” said Rob Sands, president and CEO of Constellation Brands.
“Therefore, the business is no longer consistent with Constellation’s strategy. We believe CHAMP has the requisite skills and motivation necessary for accelerating the success of the CWAE group.”
CHAMP managing director John Haddock said the company was “committed to supporting management in building a competitive and profitable business in the Australian and UK markets, and will invest to grow the business”.