McWilliam’s Wines up for sale and could attract private equity interest

One of Australia’s largest winemakers has entered the market after going into administration last month, with agents expecting ‘wide-ranging’ interest.

Administrators for McWilliam’s Wines Group have placed its portfolio up for sale, including one of Australia’s largest wineries.

McWilliam’s Wines Group, a family owned business that is in the top 10 of Australian wine producers by revenue, was placed into voluntary administration in January 2020 due to a changing wine market and a shortage of capital, the McWilliam family said.

Colliers International has been appointed by administrators KPMG to oversee a sale of the business, which will see the company’s assets and brands sold together or separately, including a recapitalization of the business or a sale via a deed of company arrangement.

The sale includes the Hanwood winery in the Riverina region of New South Wales. It is one of the largest wineries in Australia with an operational processing capacity of approximately 42,000 tonnes.

Also on the block is the Mount Pleasant winery in NSW’s Hunter Valley region and the company’s brands, including McWilliam’s, McW and Mount Pleasant. McWilliam’s Wines Group also holds the sole Australian distribution rights for Taittinger champagne.

The firm announced that its Riverina assets were not affected by Australia’s unprecedented bushfire season, but added that no vintage would be produced this year in the Hunter Valley due to smoke taint. The business recorded revenues of A$97 million ($65 million; €59 million) and 9LE (nine litre equivalent cases) sales volume of 1.3 million in FY19.

Tim Altschwager and Nick Dean will lead the sales process for Colliers International. Altschwager said the business was likely to attract a wide range of prospective buyers.

“We anticipate wide-ranging interest from major wine industry participants, private equity investors, high-net-worth individuals and buyers looking for restructure opportunities,” he said.

“In particular, existing wine industry groups will see an outstanding opportunity to add an iconic Australian name to their portfolios. McWilliam’s does not currently have an extensive international distribution network, which makes this a substantial opportunity for a buyer with overseas networks to really ramp the business up.”

Private equity has been attracted to Australian wine businesses of scale, with the Carlyle Group buying the country’s largest winemaker, Accolade Wines, for A$1 billion in 2018.

Expressions of interest in McWilliam’s close on March 31.