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Under the settlement, Australian Vintage has received an amount that would be used towards purchase of wine from Thachi Wines in South Australia, owned by Indage. The wine is in addition to the $6 million non-refundable deposit previously paid to Australian Vintage by Indage for the Loxton acquisition.
Australian Vintage has retained the Loxton winery and the suit has been withdrawn.
Indage had agreed to acquire the 90,000 tonne-capacity Loxton winery in South Australia from Australian Vintage for $60 million in March 2008. The sale was to be completed by September 2008 but was subsequently deferred until October when Indage had said that it would be unable to complete the purchase of the winery at the designated time but it remained committed to the acquisition.
Indage had confirmed to delWine at that time that the deal would be completed but knowing the financial condition of the company and the ensuing recession, we had expressed serious doubts about the deal being completed. It seemed unlikely that they would be able to raise the finances from the alternate sources.
The industry experts in Australia and India had expressed surprise at the timing and the price settled at that time and the wisdom of Indage getting into the unknown, highly competitive industry plagued with wine glut.
In April 2009, Australian Vintage said Indage had failed to confirm that it would complete the acquisition and Indage had asked for more time, according to the report in Age. Australian Vintage refused the request and subsequently took them to court.
Subsequent to the withdrawal of the case, Vintners has announced that it would continue to look for a buyer, which in today’s conditions is a highly unenviable task. They would have to offer massive discounts as compared to the price agreed with Indage, even if they were to find a buyer.
For some of our earlier related articles, click
http://www.indianwineacademy.com/e_magazine/delwine_265.asp
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