Byron, Arrowood & Freemark Abbey have just been pruchased by Jess Jackson and his wife for ~$96 MIL. [See release here]
Good for them.
Really....
But that price seems a bit on the high side.
Now years ago when Byron & Arrowood were sold together for $40 MIL from Mondavi to Legacy it was widely regarded as being overpaid for...but even IF those wineries had stepped up to the plate & were now worth what was paid then ( which they really haven't)...well, that means that they just paid ~$56 MIL for Freemark Abbey ALONE.
Byron shares a property line with one of the Santa Barbara wineries they own, and that might make it more attractive, but really, $20 Mil for Arrowood (when it hasn't stepped up it's performance since the last time it was purchased) is kinda funny.
And I guess this means ol' Dick Arrowood won't be buying his namesake winery back as I had hoped at one time.
So why'd they do it?
Wish I knew that one, but probably the Jackson/Banke camp is the only place to find the reasoning behind it. I can't make much sense of it - it just seems like it's waaaaay over priced for those brands...
Good for them.
Really....
But that price seems a bit on the high side.
Now years ago when Byron & Arrowood were sold together for $40 MIL from Mondavi to Legacy it was widely regarded as being overpaid for...but even IF those wineries had stepped up to the plate & were now worth what was paid then ( which they really haven't)...well, that means that they just paid ~$56 MIL for Freemark Abbey ALONE.
Byron shares a property line with one of the Santa Barbara wineries they own, and that might make it more attractive, but really, $20 Mil for Arrowood (when it hasn't stepped up it's performance since the last time it was purchased) is kinda funny.
And I guess this means ol' Dick Arrowood won't be buying his namesake winery back as I had hoped at one time.
So why'd they do it?
Wish I knew that one, but probably the Jackson/Banke camp is the only place to find the reasoning behind it. I can't make much sense of it - it just seems like it's waaaaay over priced for those brands...
posted by St. Vini at 6:50 AM
1 Comments:
When Constellation bought Blackstone from the Benham brothers in '02 for $140 million, I too thought they paid too much for a 400K case brand. But they turned it into a 1.6 M case brand fairly quickly. It seems to be all about distribution leverage, which KJ certainly has.
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