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US investment company increases stake in TWE

Global investment company BlackRock has increased its stake in Penfolds owner Treasury Wine Estates (TWE) to 8.32%, with shares valued at over AU$1 billion.

In an announcement published by the Australian Securities Exchange on 16 January, TWE said BlackRock had increased its stake in the company, having initially invested back in TWE back in March 2017.

This followed another share buy up by BlackRock in December 2019. The investment firm had bought another 7.3 million shares in TWE, increasing its stake from 6.21% to 7.22%. It now owns 8.32%.

It follows news that BlackRock was to back out of its investments in the coal industry, with a view to investing in sustainability-focused companies this year.

Back in July 2019, TWE signed the Porto Protocol, a global network and forum that requires businesses to commit to reducing their impact on the environment.

BlackRock has also invested in English drinks producer Chapel Down, acquiring a 5.79% share in the Kent-based business in January 2018.

Last year, TWE’s profits after tax rose 16% to AU$419.5m in the 12 months to June 2019. The wine company also announced that it was planning a AU$215m investment in its Wolf Blass Bilyara winery.

TWE said that it would invest between AU$150m and AU180m in the project over the 2020 and 2021 financial years, as well as spending an additional one-off amount of AU$35m in FY20.

The company also announced that it had acquired production facilities and “vineyard assets” in Bordeaux in order to expand its country of origin portfolio, which is comprised of its Penfolds, Beaulieu Vineyard and Maison de Grande Esprit brands.

TWE launched its Maison de Grande Esprit label in 2017 which includes three tiers of wines, including reds from Bordeaux, Burgundy and Châteauneuf du Pape, and a rosé from Provence.

Penfolds first announced it was developing a Champagne in 2018, but in May 2019 it confirmed it would also release three wines from the “spectacular” 2012 vintage – a Chardonnay Pinot Noir Cuvée, and two single vineyard wines, a Blanc de Blancs from Avize Grand Cru, and a Blanc de Noirs from Aÿ Grand Cru.

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