Drastic plan to curb wine glut
Drastic plan to curb wine glut
Apr 6, 2010 6
AUSTRALIAN Vintage and Constellation Brands plan further cuts to their already heavily reduced wine production if a proposed mega-merger goes ahead.
In a bid to boost competitiveness in the international wine market, they are planning to mothball some of Constellation's 11 wineries and Australian Vintage's three in addition to the two each has already closed.
No production facilities will be sold to prevent other companies from acquiring them and producing profit-sapping cheap wine.
US-based Constellation Brands -- the world's biggest wine company with annual wine sales of about $US3 billion -- and ASX-listed AVL have been negotiating since the middle of last year about merging their Australian and European assets.
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