Paragon latest victim of recession as more wine companies look set to close
- Monday 23 March 2009
As Paragon winds down its wine business and leading names such as Quinta do Noval and Trimbach search for new UK distribution, decanter.com understands that at least two more well-known suppliers are facing difficulties.
The companies, who cannot be named for legal reasons, may be forced to sell up to inject fresh capital into their businesses, sources suggest. ‘A number of people are very nervous right now,’ said one industry insider. ‘I’m sure we can expect some more mergers and acquisitions this year.’
Paragon’s parent company, Angostura Suisse, said that the ‘controlled closure’ would aim to protect the interests of the company’s 28 staff, plus suppliers, customers and agencies.
The company said: ‘We have made significant progress in reviving the business over the last year, despite the many legacy issues that were inherited. The economic climate, coupled with the rapid devaluation of sterling, has made the ongoing trading position of Paragon unattractive.’
Paragon, founded in 1990 by Gonzalez Byass, Veuve Clicquot and Baron Philippe de Rothschild – all of whom have since exited the business – was bought in 2004 by CL Financial, owner of spirits companies including Angostura and Burn Stewart Distillers.
CL has since been impacted by the implosion of the world’s financial markets, and was the subject of a bail-out by Trinidad’s central bank in January.
Paragon was also hit by the departures last year of co-founders Tony Dee and Peter ‘Slim’ Williamson, reportedly after the pair clashed with CL over strategy.
Dee subsequently became a non-executive director of rival agency PLB, which has aimed to build up its on-trade business, recruiting a number of ex-Paragon employees. Leading South African producer Vergelegen switched from Paragon to PLB earlier this year.
Meanwhile, two weeks after Gabriel Meffre was acquired by French wine giant Boisset, the future of another of the country’s high-profile wine producers is in doubt, with at least two potential buyers waiting in the wings.