McWilliam’s Wines new owners plan sustainable, premium label

Administrators will hand over the reins of McWilliam’s Wines to a global asset management firm next month. See what the new owners have planned for one of Australia's oldest wine businesses.

Doug and Greg McWilliams at their NSW winery. Picture: Kimbal Baker

FAMILY ownership of one of Australia’s oldest wine brands, McWilliam’s Wines, will officially end next month when Melbourne-based Prcstnt Asset Management assumes control from administrators.

The 143-year-old company was placed into administration in January after it failed to secure enough capital to more aggressively push its premium products amid floundering sales of its below-$10 wines.

Creditors overwhelmingly voted in favour of a $46 million takeover bid from four-year-old private equity firm Prcstnt — pronounced persistent — that was billed as an opportunity to make a cornerstone investment in Australia’s viticulture sector, return McWilliam’s to profitability and premiumise the brand.

Prcstnt is a global private equity and venture capital firm with $1 billion under management. It is focused on sustainability, agriculture, resources and renewable energy.

Prcstnt Asset Management executive chairman Charles Hunting in Melbourne.

Prcstnt executive chairman Charles Hunting, who was managing partner of Beijing-based investment management company Tsing Capital’s southern hemisphere operations before founding Prcstnt, said McWilliam’s was the company’s first agricultural acquisition outside of the cropping and livestock sectors, of which it owns five businesses in northern Australia.

He said the purchase was in part propelled by his love of wine.

“It’s a bit of a passion, but it’s also an area where we want to make an environmental difference. We like doing things in challenging environments and winemaking is not a simple thing,” he said.

Prcstnt is heavily focused on environmental outcomes and plans to push the boundaries at McWilliam’s to produce sustainable, environmentally conscious wines at scale.

The company owns AgBioEn, a renewable energy business that uses agricultural waste to produce renewable energy and fuels, and will more than likely draw on this technology at McWilliam’s.

The annual grape harvest at McWilliams winery. Picture: Kimbal Baker

Mr Hunting described it as a “leave no stone unturned strategy”.

“We’ll be looking at waste, the potential role that organics can play, improving soil health, implementing regenerative practices, the travel footprint and bottling,” he said.

Despite deep connections in Asia, and China in particular, Mr Hunting said the purchase of McWilliam’s was entirely funded by “well known” Australian investors.

Negotiations are already underway in the US and Asia to assess the opportunities for the brand.

And despite fears within the industry of a downturn in sales in China, Australia’s biggest wine export market, Mr Hunting said the company currently had no exposure to the country and while sales would be pursued there, “we’re not building a business case on the Chinese opportunity”.

The plan is to market a higher value wine, a category McWilliam’s is well-regarded in internationally despite being known for its lower-end products on home turf.

The Riverina-based wine business, which was established by Samuel McWilliam in 1877, found itself in strife at the beginning of this year as trading losses continued to mount while its sales were in the sluggish commercially-priced sector.

In a shock to NSW’s wine industry, the company entered voluntary administration in early January following cumulative losses of almost $90 million since 2014-15.

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