ONE of Australia's oldest winemakers, the McWilliam family has sold three vineyards to Hong Kong-listed group CK Life Sciences for $15.7 million in a sale and lease back arrangement.
The deal includes the Hanwood Vineyard in Griffith, NSW - the first vineyard planted by John James McWilliam more than a century ago - and the Station and Kirkgate vineyards in Coonawarra, South Australia. The vineyards comprise 700 hectares of land and 650 hectares of planted vines.
Under the agreement with CK Life Sciences, McWilliam's Wines Group will rent the vineyards for 15 years, with further options to renew the tenancy for five years.
The McWilliams are pioneers of wine making in NSW, dating back to 1877 when Irish immigrant Samuel McWilliam planted the first vineyards in Corowa on the banks of the Murray River. The wine group, whose brands include Mount Pleasant, Evans & Tate, and Brands Laira, is chaired by fifth-generation family member Doug McWilliam, with sixth-generation Scott McWilliam the winemaker. No one at the McWilliams vineyards could be reached for comment.
The McWilliams acquisition is CK Life Sciences' sixth vineyards purchase in Australia, taking its portfolio to 8700 hectares. It acquired the McWilliams vineyards on its own balance sheet. CK Life Sciences also has majority ownership of Belvino Investments, which owns 4600 hectares of planted vineyards in Australia and 1100 hectares of vineyards in in the North and South Islands of New Zealand. CK Life Sciences is primarily a developer and marketer of agriculture-related products. Apart from Australian vineyards, it also owns the Cheetham Salt flats near Geelong, which it bought from Ridley Corporation for $150 million in February 2013.
In a separate deal, ASX-listed wine company Brand New Vintage, whose brands include One Planet produced in the Adelaide Hills, and Sticks in the Yarra Valley, announced it had sold its Yarra Valley vineyards for $5 million to an offshore buyer. A third deal was the 59-hectare Richings 2 vineyard in the Coonawarra, which was sold at auction for $1.075 million by Colliers International on behalf of receivers Ferriers Hodgson. It is one of two neighbouring vineyards put up for sale by the receivers. Both have ties to Candoora No 19, a vehicle controlled by former Wingara Wine Group chief executive David Yunghanns. The second property, the 25-hectare Yates vineyards, is still for sale.
Colliers International's director of rural and agribusiness valuations, Nick Cranna, said these transactions provided a confidence boost for vineyard property. "There is relative optimism now that the Australian dollar is around 80¢."
"Many winemakers need to find a home overseas for their products to be viable," he said.
Recent figures published from Wine Australia show sales of ultra premium wines, or wines priced above $50 a bottle, hit a record during 2014, helping boost the average value of Australian bottled wine exports by 7 per cent to $4.85 a litre, its highest level in a decade.
"It's encouraging to see the value of Australian wine exports in positive growth for the first time since 2007 and increasing demand for our premium wines was a major contributing factor to that growth," said Australian Grape and Wine Authority's acting chief executive Andreas Clark.
