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May 2017 WINES&VINES 15 WINE INDUSTRY NEWS N apa Valley, Calif.—E. & J. Gallo Winery's trend of buying top assets continued April 13, when a deal closed for the Modesto, Calif.-based company to purchase the prestigious Stage- coach Vineyard property that straddles the Atlas Peak American Viticultural Area and the Pritchard Hill region. The deal included eight parcels at a total purchase price of $180 million, according to deeds recorded in Napa County. The deal also reportedly included non-real estate items that would make the total price even higher. Gallo bought the 1,300-acre property from Dr. Jan Krupp, who acquired it in 1995. The 600-acre vineyard spans altitudes from 1,200 to 1,750 feet above sea level in a "hanging bowl," a desirable mountainous valley overlooked by Atlas Peak itself. The Stagecoach Vineyard pur- chase continues Gallo's recent strategy of acquiring brands mov- ing up in the market—and acquir- ing top vineyards and winemaking properties to supply them. Gallo's aggressive moves mirror that of other ambitious family wine companies. While publicly held corporations like Constellation Brands and Treasury Wine Estates shed assets to improve return on investment, major family-owned wine companies such as Gallo, Jackson Family Wines, Delicato Family Vineyards, Trinchero Family Estates, Foley Family Wines, Vin- tage Wine Estates and Wilson Ar- tisan Wineries are digging in for the long haul with added brands, wineries and vineyard acreage. In 2015, Gallo bought the 642- acre Cypress Ranch and Palisades Vineyard in Pope Valley next to the Sun Lake Vineyard, already farmed by Gallo. The properties are in the Napa Valley AVA though distinct geographically and lying at consid- erably higher elevation (700 feet to 1,200 feet). The same year, the com- pany bought The Ranch, a custom- crush winery in St. Helena once owned by the Trinchero family. In Sonoma County, Gallo bought the historic Asti winery in 2015. The 535-acre Alexander Valley property included 275 acres of grapes and one of the largest production facilities in Sonoma County. The company also purchased J Vineyards and Winery in Healdsburg, Calif., in 2015 to capitalize on the boom in sparkling wine. Gallo also acquired the Souver- ain brand from Treasury Wine Estates in 2015. The following year (2016) saw Gallo purchase the Napa-based Orin Swift brand. A prime property The Stagecoach property con- tains more than 600 acres of vine- yards planted to a variety of grapes with valuable Cabernet Sauvignon being most promi- nent. The grapes grow in a vari- ety of soil depths and types, exposure and microclimates. Announcing the purchase, Roger Nabedian, senior vice pres- ident and general manager of Gallo's Premium Wine Division, said, "This purchase affirms Gal- lo's commitment to compete in the luxury wine segment and pro- vides us the opportunity to con- tinue making and selling luxury wine offerings such as Louis M. Martini, William Hill Estate and Orin Swift." Stagecoach already was sup- plying grapes to Martini and Wil- liam Hill, as well as about 90 other wineries. Some of the clients are quite large, though many are bou- tique operations. More than 30 wineries bear the Stagecoach name on their label. Gallo has promised to fulfill existing contracts, but it intends to use the site's grapes for its own brands eventually. Such a move could affect the many wineries who buy grapes, and at least one winemaker who now buys Atlas Peak fruit admits it will be a problem. Napa Valley grapes are already in high demand and expensive, and few new vine- yards are likely to be planted due to severe environmental restric- tions as well as geography, geol- ogy and water shortages. Zepponi & Co. served as the exclusive financial advisor to Stagecoach Vineyards. Exact terms of the deal were not disclosed. —Paul Franson TOP STORY Gallo Buys Stagecoach Vineyard for $180M March 23, 2017 Stagecoach Vineyard (pictured above, Napa Valley, Calif.) June 9, 2016 Orin Swift brand (Napa Valley, Calif.) Dec. 15, 2015 The Ranch custom-crush winery (Napa Valley, Calif.) Aug. 26, 2015 Talbott Vineyards (Central Coast, Calif.) July 20, 2015 Asti Winery (Sonoma County, Calif.) Souverain brand May 19, 2015 Cypress Ranch and Palisades Vineyard (Napa Valley, Calif.) March 24, 2015 J Vineyards & Winery (Sonoma County, Calif.) August 29, 2014 Winterhawk Winery & Vineyard (Solano County, Calif.) April 28, 2014 Ledgewood Creek Winery & Vineyard (Solano County, Calif.) Sep 12, 2012 Snow's Lake Vineyard (Lake County, Calif.) Aug. 10, 2012 Courtside Cellars custom-crush winery (Central Coast, Calif.) June 4, 2012 Columbia Winery and Covey Run brands (British Columbia) June 28, 2011 Edna Valley Vineyard & Winery (Central Coast, Calif.) Vineyard Winery Brand GALLO ACQUISITIONS