Constellation Brands nears deal to sell Canadian wine business for C$1 bn

Constellation Brands, the world's largest wine producer, is nearing a deal to sell its Canadian wine business to Ontario Teachers' Pension Plan for around C$1 billion ($760 million), the Wall Street Journal yesterday reported, citing people familiar with the deal.

A sale would come four years after the New York-based company sold its 80 per cent stake in its wine operations in Australia, the UK and South Africa to Australian private equity firm Champ Private Equity, for A$230 million ($230 million). (See: Constellation Brands to sell wine operations in Australia, UK and South Africa)

Constellation, which has grown through internal expansion and by acquisitions, had in April hired Goldman Sachs Group to explore an initial public offering for its Canadian wine business, but opted for a sale after it received buyout interest from Canadian rivals and Ontario Teachers.

Constellation is leading wine company in Canada, owning eight of the top 25 wine brands. It has eight wineries spanning 1,700 total acres, one distillery, a production facility, and a distribution centre.

Most of this came into its portfolio through it 2006 acquisition of Canadian wine group Vincor International in a deal worth nearly C$1.6 billion

Its Jackson-Triggs and Inniskillin, are the top wine and ice-wine labels in Canada, respectively.

A Fortune 500 Company, Constellation is a leading international producer and marketer of beer, wine and spirits with operations in the US, Canada, Mexico, New Zealand and Italy having more than 100 brands, sales in around 100 countries, about 40 facilities and 9,000 employees.

It is the third-largest beer company in the US and the world's leader in premium wine, selling great brands, including Robert Mondavi, Clos du Bois, Kim Crawford, Meiomi, Mark West, Franciscan Estate, Ruffino and Jackson-Triggs.