Andrew Peller Limited announced today that it has signed definitive agreements to acquire 100 per cent of Black Hills Estate Winery and Gray Monk Estate Winery and has entered into a letter of intent to acquire 100 per cent of Tinhorn Creek Vineyards, for a combined purchase price of $95 million. The three estate VQA wineries in British Columbia’s Okanagan Valley generated total revenues of approximately $25 million in their latest fiscal years. The purchase will be funded by a combination of $78 million in cash from the company’s credit lines and $17 million worth of class A common shares. The company expects to close all of the transactions on or before the end of October 2017.
“My grandfather started our business in the Okanagan nearly 60 years ago, and we have always been inspired by the Valley’s promise to make wines that rival the very best in the world. We have long admired these leading estate VQA wineries and now it is a privilege to bring their ultra-premium wines and talented people into our family,” said John Peller, Andrew Peller Limited’s Chief Executive Officer. “With our investment and resources, these wines have the potential to grow, develop and compete in the growing luxury wine market around the world.”
Black Hills Estate Winery, located on the Black Sage Bench near Oliver, B.C., is one of Canada’s most prestigious wine producers with an award-winning portfolio of premium and ultra-premium wines, including its flagship Nota Bene, the number one ultra-premium red wine in Canada. Recognized for its terroir and 50 acres of vineyards, the winery consistently sells out of its high performing portfolio of VQA wines.
“Black Hills has been proud of how we have evolved our quality over the years. This new partnership allows us access to resources and tools to evolve even further,” said Glenn Fawcett, President, Black Hills Estate Winery.
Gray Monk Estate Winery, founded in 1972, is a family-owned and operated winery located in Okanagan Centre in the Lake Country region north of Kelowna, B.C. With a beautiful estate winery and 50 acres of grape plantings, Gray Monk is a favorite destination for wine lovers visiting the Okanagan Valley to enjoy BC’s best-selling pinot gris as well as other popular red and white wines.
“We’ve known the Peller family for many years and share and appreciate the same values and approach to quality winemaking. We are delighted to partner with them to continue the legacy of Gray Monk Estate Winery in the Okanagan,” said George Heiss, co-owner, Gray Monk Estate Winery.
Tinhorn Creek Vineyards, located on the Golden Mile Bench, the Okanagan’s only sub appellation, near Oliver, B.C., sits among 150 acres of vineyards and the winery’s prestigious and award-winning Miradoro Restaurant. Family-owned and operated since 1993, Tinhorn Creek produces both red and white wines in the ultra-premium category sold through their loyal wine club, numerous on-site events, restaurants and fine wine retailers.
“It has been the honour of my life to have helped build Tinhorn Creek, to make great wines with an attention to sustainability and most importantly, to run our business with empathy toward our employees, our customers and our community.” said Sandra Oldfield, CEO, Tinhorn Creek Vineyards. “Andrew Peller will continue the long term development and growth in the Okanagan that we started.”
According to Randy Powell, the company’s President, there is a significant opportunity for growth in the Okanagan wine region. “Canadian consumers are becoming more and more interested in super and ultra-premium wines, and these are some of the greatest brands in the country” Powell stated. “They complement our Western Canada VQA portfolio well and will significantly strengthen our presence in the region.”
Completion of the each transaction is subject to a number of conditions customary for transactions of this nature and, in the case of Tinhorn Creek Vineyards, entering into a definitive agreement. In addition, the issuance by the two company of class A common shares in connection with the transactions will be subject to the approval of the Toronto Stock Exchange. Each transaction is independent of, and not conditional upon, the other transactions.