Ascentia Wine Estates, a Healdsburg company established in 2008 with ambitions to restore local ownership to some of Sonoma County's most prominent wineries, is being sold off in pieces.
Employees at Geyser Peak Winery, Ascentia's flagship property in Sonoma County, on Thursday said managers informed staff the Geyserville winery is being sold to an Australian-based wine group. The buyer, Accolade Wines, could finalize the acquisition today, several employees said.
"We're being told tomorrow or Monday, that's all they've really told us," Jon Meola, a hospitality representative at Geyser Peak, said Thursday afternoon.
Jim DeBonis, CEO of Ascentia, declined to comment Thursday, citing confidentiality agreements. DeBonis said he was drafting a statement that would be released today or Monday.
Meanwhile, the Healdsburg company is reportedly selling its two Washington wineries to E&J Gallo. Wine Industry Insight, an online publication based in Sonoma, reported that employees at Columbia Winery and Covey Run were notified Thursday in emails from Ascentia management that both wineries would be sold to Gallo today.
DeBonis declined to confirm that emails had been sent to employees. John Segale, a spokesman for Gallo, said there hasn't been any announcement.
Rumors about the dismantling of Ascentia Wine Estates have been swirling for weeks. Its lead investor, GESD Capital Partners, declined to comment two weeks ago when asked about Ascentia's plans to sell off its wineries, and the San Francisco company did not return a phone call on Thursday.
Ascentia had heavy debt that dates back to its formation in 2008, when a team of veteran wine executives led by DeBonis essentially borrowed $209 million to purchase a cluster of wineries in California, Washington and Idaho from Constellation Brands.
Into the fold came Geyser Peak; Buena Vista Carneros in the Sonoma Valley, the oldest winery in California; and Gary Farrell Vineyards & Winery in Healdsburg, a producer of high-end Russian River pinot noir and chardonnay.
The deal also included Columbia Winery, in Woodinville, Wash; Covey Run, in Sunnyside, Wash.; Ste. Chapelle winery in southwest Idaho; Atlas Peak, a high-end Napa wine brand, but not the vineyards or winery by the same name; and XYZin, a zinfandel brand produced at Geyser Peak.
Together, the portfolio produced more than 1 million cases of wine per year and employed 270 people, creating overnight one of the largest wine companies in Sonoma County.
But the company quickly began to struggle. Shortly after its creation, a financial crisis shook Wall Street, the economy tumbled into recession and wine sales dropped.
Ascentia struggled to make debt payments and became embroiled in a legal battle with one of its key investors, Deutsch Family Wine & Spirits, which also marketed its wines.
Investors hired a new CEO to turnaround Ascentia in early 2011, but brought back DeBonis six months later following a disagreement over strategy with his replacement.
Gradually, over the years, Ascentia has been shedding assets.
Last year, it sold off the 35,000-case Buena Vista Carneros brand to Boisset Family Estates and the 25,000-case Gary Farrell Winery to the Vincraft Group.
Two weeks ago, Ascentia sold its Ste. Chapelle Winery, which produces about 130,000 cases of wine each year, to Seattle-based Precept Wine.
Accolade Wines, an Australian wine company with nearly 40 brands in its portfolio, is now on the verge of buying Geyser Peak, employees said. Accolade was formerly owned by Constellation Brands, but last year was acquired by CHAMP Private Equity, also based in Australia, according to the company's website.