Inertia Beverage Group has provided a cash infusion to New Vine Logistics to help the Napa wine storage and shipping company resume operations after shutting down last week, according to the companies.
New Vine is bringing back workers in a bid to hold onto customers following a financial crisis that left wineries scrambling to reclaim their wine and find new vendors to store and ship to consumers.
?Our primary goal is to get operations back up to normal as soon as possible. We?re providing the interim cash to make that happen,? said IBG President and CEO Ted Jansen. ?It?s going to accelerate as we go through the back orders. We should resume to normal operations within a few days.?
After reducing its 110-employee workforce to a skeleton crew last week, New Vine has new life, company officials said.
?This is a fluid situation and we?re getting the company operational,? said Charlotte Milan, a New Vine spokeswoman.
Founded in 2001, New Vine developed technology and systems that enabled wineries and online retailers to ship directly to consumers in 44 states. New Vine had about 250 customers.
The company ceased operations after venture capital firms balked at reinvesting more money in the company. Experts on industry shipping and online retail sales said New Vine had been mismanaged and was losing customers.
Inertia helps wineries sell direct to consumers, restaurants and retailers. Also based in Napa, the company builds and operates Web sites, provides software for online transactions and offers direct shipping. Inertia has about 300 customers.
In a preliminary deal hammered out over the past two days, Inertia agreed to take over Silicon Valley Bank?s debt position in New Vine. The initial cash funding is a first step and the agreement should be finalized over the next two weeks, Jansen said.
The debt Inertia is taking on wasn?t disclosed. Inertia becomes New Vine?s top creditor, but Jansen said no decision has been made on whether the company will take over New Vine.