McLaren Vale’s Fox Creek Wines working on restructure after falling into administration

McLaren Vale’s Fox Creek Wines has called in administrators to help revive the winery, four years after it was acquired by a trio of prominent industry figures.

McLaren Vale’s Fox Creek Wines has called in administrators to help revive the winery, four years after it was taken over by a trio of prominent industry figures.

Ben Gibson, Jock Harvey and Dim Georgiadis acquired the award-winning wine business from its founders at the beginning of 2021, just as Chinese authorities introduced hefty tariffs that crushed the industry for three years before they were lifted earlier this year.

The trade disruption, rising costs and the cost of living crunch that has hit tourism and visitation numbers have been blamed for the collapse, which follows a string of insolvencies across an industry in crisis.

The cellar door at Fox Creek Wines in the McLaren Vale.

Fox Creek Wines director Mr Gibson said the decision to call in administrators had been made “in the best interests of our stakeholders”, and he would now work with administrators on a restructure plan.

“Since we purchased Fox Creek Wines in January 2021, we have experienced a very challenging period for the wine industry,” he said.

“This has included global disruptions from Covid-19, reduced tourism visitation, tariff issues in the China market, and then broader economic pressures with increased costs across the business and now the cost of living having a major impact on visitors to our cellar door and sales.

Challenging business conditions including Covid and China trade tariffs hit the business hard.

“The decision to appoint KPMG was made after careful consideration with the best interests of our stakeholders in mind and reflects our ongoing commitment to sustainability and long-term success during a challenging time for the wine industry.

“KPMG will oversee a comprehensive review of our business operations and financial structure, with the primary objective of brand sustainability and ensuring strong financial stability.”

Fox Creek Wines was established in 1994 by Helen and Jim Watts, and has received numerous awards over the years, including being recognised in the “outstanding” category of the prestigious Langton’s wine classification for its flagship Fox Creek Reserve Shiraz.

KPMG’s Tim Mableson and David Kidman have been appointed voluntary administrators of three entities comprising the Fox Creek Wines group, which operates from a 46ha site on Malpas Rd, between the townships of McLaren Vale and Willunga.

The winery has won several awards since it was established in 1994.

The landholding is home to 20ha of vineyards, a 1200-tonne winery and 19th century stone cottage cellar door. Fox Creek Wines employs 10 staff.

Mr Mableson said administrators had assumed day-to-day control of the Fox Creek Wines operations, and would continue trading on a “business-as-usual” basis while a restructuring plan is developed for creditors.

“Fox Creek Wines has been a mainstay of the McLaren Vale wine region for the past 30 years,” he said.

“As administrators, we will be working with stakeholders to formulate a restructuring plan that achieves the most optimal outcome for creditors.

“We ask consumers to show their support for Fox Creek by purchasing its award-winning wine to help ensure this iconic Australian business survives and thrives.”

The first meeting of creditors is scheduled for October 30.

Originally published as McLaren Vale’s Fox Creek Wines working on restructure after falling into administration