Treasury steps up Tasmanian stake2nd July, 2013 by Gabriel Savage
Treasury Wine Estates has become the latest producer to increase its investment in Tasmania, having signed a deal to purchase White Hills Estate from Brown Brothers.
Located in Tamar Valley to the north of the island state, White Hills was established in 2004 and features 83 hectares of vineyard, including Pinot Noir, Chardonnay, Sauvignon Blanc, Riesling, Pinot Gris and Gewürztraminer.
Commenting on the deal, which was for an undisclosed amount but is expected to conclude at the end of July, Treasury CEO David Dearie noted its boost for the company’s “long term strategy of owning or controlling vineyards that supply grapes for our luxury portfolio.
“Over the last 18 months we have invested heavily in premium grape and wine production capacity globally, and this is a logical next step,” he added. “I’m particularly excited to be increasing our investment in Tasmania at a time when the region is becoming better known and much sought after around the world.”
Dearie highlighted Treasury’s “already strong” commitment to Tasmanian wine, noting that the state is already home to the group’s Heemskerk and Abel’s Tempest brands. In recent years Tasmania has also proved an important source of grapes for Treasury’s flagship brand, Penfolds.
Speaking to the drinks business last month, Penfolds’ chief winemaker Peter Gago noted that the state provided around 35% of the fruit for its Yattarna 2012 Chardonnay. For the 2010 and 2011 vintages he revealed that this proportion rose to as much as 90% Tasmanian fruit.
Despite this sale, Brown Brothers retains a stake in Tasmania with Tamar Ridge, which it bought in 2010, as well as Pirie and Devil’s Corner. In recent years other Australian producers have recognised the opportunity offered by this region, including Michael Hill-Smith MW, co-owner of Adelaide Hills producer Shaw & Smith., whose cousin Robert Hill Smith already owns sparkling wine producer Jansz.
Earlier this year, winemaker Andrew Pirie, who has been a major pioneer of Tasmanian wine since the 1970s, highlighted its attractiveness for high quality wine production as part of a drive to bring in foreign investment.
“We’re one of the few regions of the world that’s still short of production,” he remarked of the healthy demand for Tasmanian wines, which in 2011/12 achieved an average export price per litre of A$13.16, compared to Australia’s national average of A$4.40.