Pernod Ricard to buy California winery Kenwood
(Decanter) - Jacob's Creek owner Pernod Ricard has signed a deal to acquire Kenwood Vineyards in California as it looks to premium wine to help it achieve 'critical mass' in the US.
The France-based spirits and wine giant said it has agreed to buy Sonoma Valley-based Kenwood's winery, brand rights and around 100 hectares of vineyards from F Korbel & Bros. A fee was not disclosed.
Pernod Ricard is looking to increase its presence in the US and its acquisition comes in the same week that Wine Institute figures show that sales of California wines in the country rose by 5% in 2013, to an estimated retail value of $23.1bn.
'We had a weakness in the US market, where we did not have a critical mass,' a Pernod spokesperson told Decanter.com. 'We needed to acquire a US brand and this is why we have identified Kenwood Vineyards.
'This acquisition will bring synergies and we will be able to develop the brand in the US.'
Kenwood produces 500,000 cases of wine annually and sells at an average retail price of more than $10-a-bottle. Its top wine, Artist, sells for up to $45, Pernod said.
Data from the California-based Wine Institute shows that sales of the state's wines price at $10 and above rose by 9% in volume across the US last year. Overall sales of California wine in the country rose by 3%, showing stronger demand for premium brands.