Treasury Wine Estates has reached an agreement to acquire the highly acclaimed Frank Family Vineyards (FFV) for AUD$434million, including the historic winery, brand and vineyard holdings. The transaction is expected to close in December 2021.
FFV was founded 30 years ago by former Disney Studios president Rich Frank who left Hollywood with his wife Lee (née Miller) for the Napa Valley in 1994 and has never looked back.
The FFV portfolio comprises an award-winning luxury portfolio across three collections, with retail price points ranging from US$38 to US$225 per bottle. FFV’s portfolio is chardonnay led and supported by a range comprising cabernet sauvignon, pinot noir and sparkling wine.
The acquisition fills a key portfolio gap in the large and growing luxury Chardonnay segment – improving Treasury Americas share in luxury chardonnay to number three overall, and to number two in US$25 and above[1]. TWE also say that it provides an opportunity for increasing distribution in the off-premise channel and under-penetrated states.
It also increases Treasury Americas coverage of on-premise accounts in California where FFV has established a strong presence, and adds an additional pillar to Treasury Americas direct to consumer growth platform, leveraging FFV’s best in class tasting room experiences and extensive wine club model.
TWE say that the FFV portfolio complements that of Treasury Americas and that TWE is well placed to enhance FFV’s growth given its own leading luxury sales credentials, national distribution network and access to exceptionally high-quality vineyards.
Tim Ford, Chief Executive Officer of TWE, said, “The acquisition of Frank Family Vineyards represents an outstanding complementary addition to the Treasury Americas brand portfolio and is another important step towards our ambition of becoming the premium wine market leader in the Americas.
“This is a rare opportunity to acquire a luxury brand and portfolio of wines that consumers enjoy and connect with. This business has a proud and consistent history and proven track record of success, having been expertly built and led by Leslie and Rich. Together with them, we are excited by the future potential that will be unlocked by the strengths of the Treasury Americas luxury wine platforms.”
The acquisition includes the Frank Family Tasting Room located at 1091 Larkmead Lane in Calistoga, the Benjamin Vineyard in Rutherford, the S&J Vineyard in Capell Valley, and a portfolio of award-winning luxury wines across three collections with retail price points ranging from US$38 to US$225 per bottle, all specially crafted by Frank Family winemaker and general manager, Todd Graff, who will remain with Frank Family Vineyards after closing.
Rich and Leslie Frank will maintain the ownership of Winston Hill Vineyard in Rutherford and the Lewis Vineyard in Napa, Carneros. Both vineyards will continue to source grapes for the Frank Family reserve tier after the sales agreement.
Ben Dollard, Treasury Americas President commented, “The acquisition of Frank Family Vineyards represents an outstanding addition to the Treasury Americas brand portfolio and is another important step towards our ambition of becoming the premium wine market leader in the Americas. Rich, Leslie, and the entire Frank Family Vineyard team have built an outstanding legacy that we are excited to nurture for years to come. We are thrilled that Rich and Leslie will continue to be very involved and welcome the FFV team to Treasury Wine Estates.”
On the sale, Rich Frank commented, “Leslie and I look forward to continuing to be a part of the next chapter of Frank Family Vineyards, a business we have spent nearly three decades cultivating into a beloved luxury wine brand. We have prided ourselves on creating a family atmosphere among our staff and our guests and know this legacy will carry on. We, along with our team, are excited to remain actively involved with Frank Family, while also taking on new leadership roles with Treasury Americas.”
Strategically the acquisition supports the continued premiumisation of TWE. The luxury wine business has delivered consistent top-line and earnings growth in addition to an outstanding EBITS margin (F18-21 volume and NSR CAGR of 7.7% and 9.1% respectively).
[1] IRI Market Advantage, MULO and Convenience, Still Wine, 52 weeks ending 3 October 2021
