Treasury Wine Estates puts Asti Winery on market

Treasury Wine Estates is putting its sprawling Asti Winery and surrounding vineyards up for sale, the latest winery to hit the market as merger and acquisition activity heats up in Wine Country.

The Australia-based company announced Monday night that it would sell the 536-acre Asti property, which is zoned for a hotel and restaurant, as part of a restructuring plan designed to cut costs in its U.S. and Australian operations.

The announcement follows Friday’s purchase of J Vineyards and Winery in Healdsburg by E&J Gallo Winery, the nation’s largest winery.

“You’re probably going to see more J Winery-like sales,” said John Bergman, president of Bergman Euro-National, a Forestville winery and vineyard brokerage. Bergman noted that the possible deals he is working on are in the $5 million to $40 million range and that potential investors include those from Silicon Valley, New York financial circles and Asia, as well as those already involved in the wine industry.

The Asti listing is unique. While it comes with a production facility and 275 acres of planted vineyards, including 100 acres of cabernet sauvignon, it does not come with any brands. The vineyards alone could be worth around $25 million, given recent land prices in the Alexander Valley.

Bill Foley, owner of Foley Family Wines, said Tuesday he would probably be more interested if there were brands attached to the sale. “They would do a lot better if they sold a particular brand and the location,” Foley said.

Foley, who in past years went on a buying spree of vineyards and wineries with his Sonoma County company, said the buyer likely would be a bigger player. The production facility is the sixth-largest in the county, with a permit to produce up to 2.5 million cases and more than 7.5 million gallons of stainless tank capacity on site.

Both Gallo and Jackson Family Wines did not comment on whether they would be interested in the property, which is just south of Cloverdale along Highway 101.

Another possibility could be a vintner who outsources winemaking to a custom-crush facility and wants to finally own their own winery, Foley noted.

The property also offers an event platform for the new owner. Asti has a county permit to hold six events of up to 1,000 people and 30 events with up to 500 customers, which is a valuable asset given that Sonoma County is coming under increasing pressure from residents to greater restrict such winery events.

International Wine Associates of Healdsburg is marketing the property.

Wines currently produced at the Asti facility will be transferred to other Treasury wineries in California, the company announced. Production of inexpensive wines will be moved to a facility in Paso Robles, while luxury wines such as Souverain will be moved to its Beringer facility in Napa County.

Treasury Wine Estates employs more than 50 people at the Asti facility, spokesman Roger Sharp said.

The company also plans to consolidate packaging lines at its bottling center in Napa and sell several “excess assets” in Australia, including its Ryecroft, T’Gallant and Bailey’s wineries. The changes are expected to reduce the company’s costs by $38 million annually, at current U.S. exchange rates, by 2020.

Treasury Wine Estates has taken the moves after a potential sale to private equity groups fell apart last year, representing part of an apparent strategy to get rid of assets that do not move the brand to higher price points.

Locally, Treasury Wine Estates owns the iconic Beringer Vineyards as well as other wineries such as Cellar No. 8, Chateau St. Jean and Souverain in Sonoma County, and Stags’ Leap Winery, St. Clement and Sledgehammer in Napa County.

“The changes announced today are significant ones for our business and demonstrate our commitment to delivering on the company’s strategic roadmap,” CEO Michael Clarke said in a statement. “By continuing to reduce costs, and optimizing the scale and efficiency of our supply chain networks in major production areas, TWE is well placed to pursue growth opportunities that exist for our wine brands in key markets around the world.”

You can reach Staff Writer Bill Swindell at 521-5223 or bill.swindell@pressdemocrat.com. On Twitter ?@BillSwindell.