22 May 2012

NZ Wine Company seeks way to repay debt

6:48 am on 22 May 2012

New Zealand Wine Company is pursuing a tie-up with a wealthy US firm, as part of its plans to repay bank debt and return to profitability.

Foley Family Wines is owned by billionaire Bill Foley and its brands in New Zealand include Clifford Bay, Goldwater and Dashwood. Last year it bought Te Kairanga Wines at Martinborough.

The New Zealand Wine Company has been in financial difficulty for some time. It markets the Grove Mill, Sanctuary and Frog Haven brands.

Grant Samuel has been providing advice on capital restructuring because it's in breach of its banking commitments.

Chairman Alton Jamieson says Grant Samuel identified Foley Family Wines as a possible merger opportunity and the company is now well through the due diligence phase.

Mr Jamieson says the merger would be enough to satisfy a requirement by its bank to raise $5 million by the end of June, as well as reduce debt.

He says he would like the merger to be complete by the end of the financial year, but approval is needed from shareholders, the Takeovers Panel and the Overseas Investment Office.