Napa Valley's Chalone Wine Group, whose majority shareholder is Baron Eric de Rothschild of Bordeaux's Château Lafite, is looking to sell some of its vineyards and buy new land elsewhere.

Tom Selfridge, Chalone’s president, says that the purchase of the Vintage Lane Winery in Glen Ellen, Sonoma County, which was to provide grapes for the company’s Dynamite brand, has not met expectations. The problem seems to be that the winemaking facilities have proved to be too small to cope with the rapid growth of the business. Chalone will be putting the property on the market and has, instead, invested in another site in Lake County, north of Napa Valley, to produce the brand.

The company is also looking at the potential purchase of the under-used Beaucanon Winery, which is located in prime wine-growing territory near Rutherford, in the heart of Napa. The winery and its vineyards are near Chalone’s recently acquired Hewitt Vineyard, in an area renowned for its Cabernet Sauvignon. While no official contracts have yet been signed, Selfridge says the site would be the ideal location for the production of the firm’s new high-end Cabernet, Provenance. Tom Rinaldi, winemaker at Napa producer Duckhorn, has been drafted in to make the wine, whose first vintage was recently released.

If Chalone goes ahead with the purchase of Beaucanon, it would no longer need its Suscol Creek Vineyard, which was intended to become Provenance’s winery. The land is currently on the market.

Selfridge is at pains to emphasise that Chalone is selling its assets to improve its holdings, not out of a need for cash. The first financial quarter saw the company report slightly higher sales and net profits, in spite of challenging market conditions.

Written by Paul Franson in California7 June 2002