Expensive Acquisitions in California

Shafer Vineyards sold for $250 million to a Korean Investor

Reading time: 1m

Shafer Vineyards (photo: Russ Widstrand)
Shafer Vineyards (photo: Russ Widstrand)

Shafer Vineyards winery, one of the most prestigious and longest established estates in California's Napa Valley, Stag's Leap District, has been sold. Most of its annual 33,000 case production comes from its 225 acre (91ha) estate.

The buyer is the Shinsegae Property group of companies from Seoul, South Korea. According to business publications, the sale price is at $250m (€220m).

"For those who are fans of our wines and our team, everything they love about our winery will continue," said Doug Shafer, who has run the winery in the second generation since 1994. Shafer Vineyards is known for producing high-quality wines, primarily from Cabernet Sauvignon.

Korean Investor Shingsegae

Shingsegae is the largest retail company in Korea, as well as one of the largest in Asia. Through its subsidiary Shingsegae L&B, it distributes alcoholic beverages from around the world. "With the acquisition, we aim to further expand the group's wine business by creating synergies with Shinsegae L&B, which is responsible for wholesale wine and spirits," a representative of the company told The Korea Herald, an English language daily newspaper based in South Korea.

A flurry of recent purchases

As the 2022 SVB report highlighted, this has been a busy time for California mergers and acquisitions, including the sale of Heitz Cellar, Diamond Creek and Stony Hill. In 2021, Treasury Wine Estates bought the highly profitable 174,000-case Chardonnay specialists Frank Family Vineyards for $315m.

While these prices seem high by the standards of other wine regions, they reflect the margins that can be commanded by Napa Valley wines. TWA reported that Frank Family, for example, makes 37.9%.

 

Latest Articles