NZ investment company and a winery buys Mahana Estate

Investment firm Booster and Nelson-based winery Seifried Estate have bought most of Mahana Estate’s assets, after a legal battle put the winery in receivership last year.

Booster’s investment arm has secured the purchase most of the site which went into receivership in September 2018 after being initially put up for sale in July. The company’s purchase includes the winery, tasting room, restaurant, function centre and 21-hectare vineyard

Meanwhile, the family-run Seifried Estate has bought Mahana’s 9-hectare Sauvignon Blanc vineyard in the nearby region of Hope, south of Nelson.

As a result of the purchase, Booster has announced the formation of the Booster Wine Group which includes its other investments in the sector: Awatere River, Waimea Estates, Bannock Brae and Sileni Estates.

Booster has called Mahana “one of the best premium winemaking facilities in New Zealand” and said that it strengthens its ability “to be internationally competitive”.

Members of New Zealand’s KiwiSaver scheme can now invest in the wine group through Booster.

Allan Yeo, managing director of Booster, said: “Most New Zealand wineries, as small independent businesses, have always been challenged by scale. The Booster Wine Group allows our wineries to focus on what they do best – produce world-class wine, while still remaining Kiwi owned and operated.

“The wine industry is one of New Zealand’s most successful exports. We’re pleased to be keeping a piece of it in local ownership and giving everyday Kiwi investors the chance to share in its success.”

Taking into account the purchase of Mahana, Booster’s wine group now produces the equivalent of one million cases a year.

Speaking to Stuff.nz, Seifried Estate winemaker Chris Seifried​ said: “We have been planting more vineyards in the last couple of years but we were running out of land available for planting in grapes.

“We have a lot of other vineyards on the Waimea Plains, within a couple of kilometres of that particular block so it suits our operation quite well.”

“It is a nice block and it has produced some good fruit in the past and we hope we can continue doing that. The vineyard is all Sauvignon Blanc which is what New Zealand is known for and what we are exporting so it should be really good.”

In total, Mahana has 30-hectares of organic certified vineyards including 21 hectares situated at the winery site (planted with Pinot Noir, Pinot Gris, Chardonnay and Riesling) and another 9-hectare vineyard planted with Sauvignon Blanc in Hope which has been bought by Seifried.

In addition, the site includes the four-story gravity-fed winery, which was designed by Oregon architect Larry Ferar and is capable of processing 500 tonnes of grapes, and a seven-bedroom villa complete with wine cellar, library and art gallery.

Yeo added: “In addition to the synergies we can achieve with our other wine investments, we are pleased to have brought a beautiful piece of land and a state-of-the-art wine making facility back into Kiwi ownership. New Zealanders collectively had more than $50bn in their KiwiSaver accounts last year – however, only a fraction of this is being invested back into New Zealand businesses.

The sale came about after American investors James Murren (chairman and CEO of MGM Resorts International) and Daniel Lee (CEO of Palms hotel-casino in Las Vegas) sued the former owner of Mahana, Glenn Schaeffer, for $3.5 million.

The pair initially brought their case to the New Zealand High Court in Nelson in 2015, claiming that Schaeffer committed “negligent misstatement, deceit and fraudulent misrepresentation” of the investment deal in Mahana. According to the court documents, Murren invested US$1.6 million while Lee shelled out US$700,400.

In December 2018, the court sided with Murren and Lee, awarding them $2.3 million, plus interest. Schaeffer has stated that he will appeal the ruling.