Treasury Wine Soars on Pernod’s Reported Interest in Assets
(Bloomberg) - Treasury Wine Estates Ltd. (TWE) surged the most on record in Sydney trading after the Australian newspaper said Pernod Ricard SA (RI) is interested in buying its U.S. assets.
The stock jumped as much as 14 percent, the steepest gain since its May 2011 debut. Treasury pared some of the gain after saying it wasn’t in talks with Pernod and the shares were up 7 percent at A$4.11 at 1:18 p.m.
A purchase of Treasury’s U.S. unit would add Beringer and Stags’ Leap brands to other Californian wines Pernod agreed to buy last week. Pernod plans to double its business in the U.S., where 80 percent of the wine consumed is domestically produced, Jean-Christophe Coutures, head of Pernod Ricard Winemakers, said in an interview with the Australian published today.
Treasury “has not been approached by, and is not in discussions with, Pernod Ricard,” the Melbourne-based company said in a statement. Frances Manfield, a Sydney-based representative for Pernod Ricard Winemakers, had no immediate comment on the report in the Australian newspaper.
In the interview, Coutures didn’t say whether the Paris-based company had already approached Treasury. Pernod said April 24 it agreed to buy the Kenwood winery in California to expand in premium wines.
Treasury, the maker of Penfolds Grange, last year booked a writedown of A$160 million ($148 million) to get rid of old stock in the U.S., the company’s largest division by revenue.
In February, the company named former Kraft Foods Group Inc. executive Michael Clarke as chief executive officer. He said in April he could turn around the U.S. business and planned to clear excess stock next fiscal year.