Massandra, historic Crimean estate, has been sold

The historic Massandra winery founded by Prince Leo Golitsyn, was sold on 14 December. Igor Serdyuk has the story.

Massandra/Felicity Carter
Massandra/Felicity Carter

The historic Massandra estate, one of the largest wine producers in Crimea, was sold yesterday at auction to the Yuzhny Proyect (Southern Project) company for 5,327 bn rubles ($72.4m), with no competition from other serious bidders. 

Rossiya bank, and its major shareholders Yury Kovalchuk and Gennady Timchenko, controls a growing winemaking empire that already includes the historic Crimean Novy Svet sparkling wine producer, the Inkerman winery and the ultramodern Usadba Divnomorskoye winery in the Krasnodar Region. With the Massandra acquisition, a major wine holding now exists, capable of leading the Russian wine industry.

The Massandra estate, which was recently transformed from a state enterprise to a joint-stock company, is a very attractive asset. According to Russia’s Forbes magazine, its sales volume reached 2.2bn rubles in 2019 with a net profit of more than 395m rubles; it has plans to produce in excess of 40m bottles per year. At present, Massandra owns and rents more than 10,000 ha of land, of which 4,000 ha are planted with vines. It is also in possession of a world-famous cellar containing some one million bottles of wine, including bottles dating back to the 18th century. The winery was founded by Prince Leo Golitsyn in 1894 and is considered to be part of Russia’s national heritage. According to the legend, one million golden rubles was spent to build the winery and its cellars. 

However, Massandra as it stands today needs massive investment to renovate its vineyards, cellars and winemaking equipment. According to a Crimean Agricultural Ministry report, Massandra’s production facilities are 60% depreciated.

Yuzhny Proyect is affiliated with the Saint Petersburg-based Rossiya bank, co-owned by oligarch Yury Kovalchuk, rumoured to be a close friend of President Vladimir Putin. Massandra obtained a 500m ruble credit from Rossiya bank in 2017 and has since been advised by the bank’s advisers

As expected, Yuzhny Proyect bought Massandra without facing any serious competition. Massandra’s reserve price was 5.3bn rubles. Apart from Russky Proyect, there was only one other bidder, an obscure, completely unknown Estate Group registered in October 2020.

Igor Serdyuk

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