585 Wine founders launch new company with acquisition

Two veteran Sonoma wine executives are launching a new venture seven months after they were forced out of the fast-growing wine company they founded.

Dan and Katy Leese, founders of 585 Wine Partners, announced the creation Thursday of a new wine production and marketing company, V2 Wine Group, in a partnership with Quivira Vineyards owner Pete Kight.

The Sonoma company's first deal: acquiring a Dry Creek wine brand, Steelhead Wines, from 585 and Kight. Terms were not disclosed, but Quivira is not part of the acquisition.

Dan Leese has a 30-year background in the wine industry, including executive stints at Beringer Blass Wine Estates and Brown-Forman's U.S. wine group.

In 2005, Dan and Katy Leese co-founded 585 Wine Partners, which markets Red Truck, Picket Fence and Bivio Italia. Steelhead also was part of 585 Wine Partners.

It became one of the nation's fastest-growing wine companies, finishing 2009 as the 27th largest wine company in the United States, according to Wine Business Monthly.

But the couple was forced out of 585 Wine Partners in January when investor Fred Franzia — the man behind bulk wine powerhouse Bronco Wine Co. — took control of the Sonoma company.

Katy Leese wouldn't comment Thursday on the circumstances of their departure from 585, but said she and her husband are glad to be back in the wine business.

"We moved on," she said. "We've been in the industry for years and it's what we love. We're excited to get Steelhead and to begin working on it again."

They hope to produce about 20,000 cases a year with the Steelhead label.

V2 plans to develop its own wines and do sales and marketing for other brands. Most will sell for more than $10, but there will also be affordable selections, she said.

Sales of premium wines have fallen as cash-strapped consumers switch to lower-cost offerings. Still, there's room for V2 to grow, Katy Leese said.

"I think the industry is evening out a bit," she said.

The new wine group will do good things for the Steelhead brand, Kight said Thursday.

"Steelhead Wines is a great anchor for what will become a strong international portfolio of exciting, highly differentiated wine products," he said.

Kight, founder of a financial software and services company, CheckFree, bought Quivira and Steelhead in 2006 from retired pharmaceutical executive Henry Wendt.

The Steelhead brand was introduced by Quivira in 2003 and was named for the restored steelhead and salmon habitat on a Dry Creek tributary that runs through Quivira's property. Part of Steelhead's sales are donated for fishery restoration projects.

Dan Leese and 585 Wine Partners acquired a share of the Steelhead brand in 2007, taking over the sales and marketing from Quivira, which continued to make the wine in Healdsburg.