December 23, 2015

Only one year  after  acquiring Peter Lehmann Wines in South Australia for $57 million, Casella Wines, the name behind the country’s top selling wine brand, Yellow Tail, has further strengthened its position in the premium wine segment with the acquisition of Brand’s Laira winery from McWilliam’s Wines for an undisclosed amount, according to The Australian.

In only ten years, Casella has grown Yellow Tail from a concept, to the leading imported wine to the U.S. market, exporting more than 12.5 million cases per year, according to the group’s managing director, John Casella, reports the Sydney Morning Herald.

In the recent past, Casella faced serious challenges when the Australian dollar was strong and margins were tight, however the business has rebounded as the Australian dollar has fallen to US$0.72, and Mr. Casella states that the goal is to increase total case sales for the Brand’s Laira winery from the current 70,000 cases to 250,000 cases over the next ten years.

“The acquisition perfectly complements our premium range of wines, extending our portfolio to include a reputable brand that represents the regional excellence of the Coonawarra,’’ Mr. Casella told The Australian. “I believe we are well positioned to build on the investment McWilliam’s Wines has made in Brand’s Laira in the domestic and international markets, in particular by showcasing the excellent Cabernet Sauvignon wines for which the region and the brand are famous.”

The sale of Brand’s Laira was decided upon following a strategic audit conducted earlier this year by McWilliam’s, which concluded that the group’s portfolio needed streamlining, according to McWilliam’s Wines chief executive officer, Rob Blackwell, who told the Sydney Morning Herald, “We’ve gone for a much more structured portfolio.”

The lower Australian dollar has re-invigorated the country’s wine industry and its exporters after years of struggle, as demonstrated by Australia’s second biggest wine company, Accolade Wines, which is reportedly planning to go public in 2016 after seeing a 10% jump in sales from its Australian operations to $486 million in the 12 months to June 30, 2015.