Dutch courage

Chris Orr considers the Nyetimber sale as St George’s day approaches

Cry God for England, Harry and St George! It is after all the big day itself next week and despite what the numerous politically correct beaurocrats say, it’s nice to see a bit more pride in our heritage and background showing through (I thought Chris was Scottish – ed.).

And it looks like a similar pride is warranted when it comes to our wine industry. It was revealed this week that Nyetimber, the sparkling wine specialists based in Sussex, has been sold to a UK-based Dutch investor for £7.5m.

Now anyone that has been silly enough to follow my writing for a few years will be aware that I am somewhat negative and sceptical about our ability to really compete in the wine market effectively. I think I’ve been as bold as to say, in the past, that we should stick to what we’re good at, namely black pudding, pork pies and good bitter, rather than trying to take on the likes of the French or the Australians at a game they’ve been playing far longer and far better.

But when I look at Nyetimber, I wonder if I’m not slightly overly negative. After all, an investor and capitalist has clearly looked at the business and considered it worth investing in. Moreover, Eric Heerema, the venture capitalist involved, has said that he has no plans to compromise on the quality aspect of the winery’s production and is looking at the long-term position and development of the brand and the winery. Quite what “long term” stands for in the mind of a venture capitalist is never exactly an easy thing to pin down. For most standard VC enterprises, they look to realize a substantial part of their investment within three to five years, usually by divesting themselves of their investment or realizing some of the cash in the business.

Now let’s be honest, £7.5m isn’t that big amount of money for a sparkling wine business. Not when you compare it to the billion francs paid out for Krug a while back, or the many hundreds of millions of pounds that are being talked of in terms of the cost of Taittinger and their vineyards. But compared to a decade ago, or even five years ago, when many wine businesses in the UK were on the market for long periods of time and going nowhere, it’s a bit of a significant sea-change – I hope – for how the UK wine producing industry is being perceived.

The problem, of course, is that most of the wines we produce are still quite undrinkable – in my humble opinion. More importantly, they are also overpriced and not competitive in the market place. The reason Nyetimber has done so well for itself is that it has consistently overdelivered in quality terms. It’s not cheap by any standards, but what the now former owners have done, is ensure that it’s highly regarded in quality terms and regularly shows well when set against the best that Champagne has to offer in a similar price band. Consequently they’ve made themselves extremely attractive to an investor.

Perhaps if more UK wineries followed their lead, we really would be able to wave the English flag with pride, and, crucially, feel comfortable toasting it with a glass of our very own homegrown produce. Hussssaaaahhhhh …