Small players keen on Treasury Wine Estates brands

The Treasury Wine Estates-owned Yellowglen vintage pinot noir chardonnay.

Bids are understood to have landed in the sale process of Treasury Wine Estates’ non-core brands that it said earlier in the year it would put on the block.

But rather than any big corporate names in the wine industry, it is understood to be small family-owned operators looking to scoop up some of the brands on offer.

The Australian reported in August that Treasury was offloading former powerhouse brands such as Lindeman’s, Wolf Blass and Yellowglen as it shifted its attention and resources to its luxury portfolio led by Penfolds and upmarket Napa Valley labels.

Treasury, once part of beer and wine giant Foster’s, went on a spending spree in the late 1990s and early 2000s to buy popular wine brands.

Once popular, the labels now contribute less than 5 per cent to Treasury Wine’s annual gross profit. They have been displaced by Penfolds and more recently Treasury Wine’s portfolio of Californian wines.

The divestments could mean that by next year more than 90 per cent of Treasury Wine’s sales come from luxury and premium wine brands.

The commercial wines put up for sale are part of the company’s Treasury Premium Brands division, which takes in other labels such as 19 Crimes, Pepperjack, Seppelt and Squealing Pig – four of the better performing wines that would be retained.

However, the entire division is suffering from a fall in demand for cheaper wine as well as a downturn in overall wine consumption, triggering an impairment of $354m ($290m post-tax) in its 2024 fiscal year results.