US fund buys $25m of Treasury shares

6th February, 2014 by Lucy Shaw

US fund manager Wellington Management has given struggling wine company Treasury Wine Estates a cash injection by splashing out AU$25m on shares in the company.

As reported by The Sydney Morning Herald, Boston-based Wellington Management snapped up the shares late last week while other investors were busy bailing out on TWE as share prices in the company slid 20%.

The drop in share prices came after Treasury revealed a AU$40 million (£21.2m) profit downgrade as it came out of a trading halt.

Wellington spent AU$5.4m on Treasury shares last Thursday and a further AU$19.8 million on Friday in order to lift its holding further.

The company – one of the largest private, independent investment management companies in the world – is now one of Treasury’s largest shareholders, with a 5.73% stake, according to the Australian Securities Exchange (ASX).

The news comes as global fund manager and Treasury Wine Estates shareholder, BlackRock Group, dipped below the 5% mark after lightening its holding in TWE last week.

The latest hangover for Treasury is being blamed in a slowdown in demand for its wines in China, which some analysts estimate may account for as much as 20% of the company’s Asian sales volume.

Treasury, which owns over 80 wine brands, including Penfolds, Wolf Blass and Wynns Coonawarra, reported a 53% profit slump in its full-year results last August, which led in part to the stepping down of Treasury’s CEO, David Dearie last September.

Last July, TWE was forced to destroy six million bottles of “old and aged commercial stock” worth £21.4m in the US due to declining sales and falling shipments.

The company is facing legal action from Australian shareholders over the incident.

Leave a Reply

Your email address will not be published. Required fields are marked *

Please note that comments are subject to our posting guidelines in accordance with the Defamation Act 2013. Posts containing swear words, discrimination, offensive language and libellous or defamatory comments will not be approved.

Subscribe to our newsletters

Job vacancies

Sales Account Manager

Jascots Wine Merchants
London, UK

Marylebone Sales Manager

Philglas & Swiggot
Marylebone, London, UK

Area Sales Manager

Bon Coeur Fine Wines
North England, UK

Procurement Assistant – Wine

Adnams PLC
Southwold, UK

Account Manager Central London

Speciality Drinks Ltd
London, UK

Brand Ambassador

Speciality Drinks Ltd
London, UK

National Business Development Manager

Speciality Drinks Ltd
London, UK

Marketing Assistant

Hatch Mansfield
Ascot, Berkshire, UK

Marketing Manager

Bancroft Wines
London, UK

Regional Sales Manager – Scotland

Bancroft Wines
London, UK

Sales Manager – London On-Trade

Bancroft Wines
London, UK

Customer Service & Sales Support Executive

Jascots Wine Merchants
London, UK

Market Insight Analyst

Conviviality PLC
London, UK

Technical Manager

Enotria&Coe
Park Royal, London, GB

The Global Sparkling Masters 2017

Deadline : 25th August 2017

The Global Malbec Masters 2017

Deadline : 25th August 2017

Global Chardonnay Masters 2017

Deadline : 1st September 2017

The Global Sauvignon Blanc Masters 2017

Deadline : 1st September 2017

Click to view more

The Global Rosé Masters 2017

With wines from the palest of pink to almost ruby red, bone dry to almost cloyingly sweet, reductively handled to barrel-aged, as well as gently spritzy to fully sparkling.

The Global Organic Masters 2017

The drinks business is thrilled to announce the launch of The Global Organic Masters

The Drinks Business Awards 2017

Now in its 15th year, the db awards have become the most authoritative, internationally respected badge of achievement in the alcoholic drinks industry.

The Asian Cabernet Sauvignon Masters 2017

the drinks business Hong Kong announces its first year of The Asian Cabernet Sauvignon Masters.

Click to view more