Vintage boost for McWilliam’s Wines bidders

Administrators of collapsed wine group McWilliam’s say they are committed to producing the 2020 vintage.

McWilliam’s administrators have said the 2020 vintage will go ahead Picture: Kimbal Baker

Administrators of the collapsed wine group McWilliam’s are committed to producing the 2020 vintage as they court expressions of interest from local and overseas buyers in a bid to save the 141-year-old company.

Lead administrator Gayle Dickerson of KPMG has been speaking to wine growers and provided them certainty in accepting all their produce for the whole 2020 vintage, which is ­expected to match last year’s 20,000 tonnes.

“It is our absolute priority in terms of trying to bed down business as usual,” Ms Dickerson told The Australian.

“We’ve been through a number of conversations with growers over the last few days and we are fully committed to meeting our financial commitments in terms of the 2020 vintage. We are pleased to come to that decision quickly.

“It helps provide that platform for the business to continue as usual, and it’s important in terms of the options we have available as we go through this process — a sale or recapitalisation. It’s a milestone.”

McWilliam’s, now in its sixth generation of family ownership, called in KPMG as administrators last week in an attempt to ­recapitalise or sell the company following a period of financial troubles, including seeking a capital injection of $6.2m and the sale of assets last year after it breached lending covenants.

Ms Dickerson said McWilliam’s was attracting a high level of interest from prospective buyers. However, she stressed it was still early days in the administration process and a formal sale process was yet to begin.

“The level of interest is not surprising given McWilliam’s is such an iconic brand. It’s one of the first families of wine businesses, so we have seen a high level of interest in the businesses … locally and offshore,” she said.

“We will be commencing a formal sale process soon but it’s certainly very encouraging to see that high level of interest.”

The commitment of producing the 2020 vintage is welcome news for the wine growers, with many watching what impact hazardous smoke from the catastrophic bushfires will have on their businesses.

Ms Dickerson said it was fortunate that McWilliam’s, which sources the majority of its grapes from the NSW Riverina, had not experienced any direct impact from the recent fires.

However, there is a question over the supply for its Mount Pleasant winery, which is in the Hunter Valley and contributed 400-500 tonnes to the 2019 ­vintage.

“The Hunter Valley has beenimpacted due to indirect smoke,” Ms Dickerson said.

“That’s something that is being assessed at the moment. But we certainly have got significant reserves in relation to the product up there.”

McWilliams is known for its affordable range of fortified wines and extensive ­product range marketed under a portfolio of brands.