Foley Family Wines in talks to buy Mt Difficulty Wines
By Paul McBeth
Oct. 24 (BusinessDesk) - NZAX-listed Foley Family Wines is in talks to buy Mt Difficulty Wines, which would add the premium Mt Difficulty and Roaring Meg brands to a suite that includes Vavasour, Grove Mill and Te Kairanga.
Blenheim-based Foley Family Wines today said it was discussing the potential acquisition of Mt Difficulty's assets and business, including the Central Otago brands, and winemaking and cellar door facilities. The details are confidential and the company said it would update the market when there are material developments.
"Entry into a transaction with MDW is subject to FFW satisfactorily completing due diligence and successfully concluding transaction documentation with MDW, and completion of any transaction is expected to be subject to conditions including the need for FFW shareholder approval and Overseas Investment Office approval," Foley Family Wines said in a statement.
Foley Family Wines, which is controlled by US businessman Bill Foley, posted a 38 percent decline in 2017 annual profit to $3.1 million, including a $2.6 million charge on damage caused to its Grove Mill Winery site in Marlborough after the November 2016 Kaikoura earthquake and $4.7 million from insurance payments.
The company spent $3.2 million on plant, property and equipment due to the earthquake damage and had just $263,000 of cash and equivalents at the June 30 balance date.
The NZAX-listed shares last traded at $1.30 and have dropped 13 percent so far this year.