Foley Family Estates to acquire Chalk Hill

Foley Family Estates, owned by insurance mogul and wine baron Bill Foley, is to purchase Chalk Hill Winery from attorney Fred Furth.

Chalk Hill produces 40,000 cases on a grand, 1,270 acre estate in Sonoma County. Its top wines sell for several hundred dollars.

Foley owns several West Coast wineries – including Sebastiani and Firestone – as well as the New Zealand Wine Trust.

Deborah Steinthal of wine business consultancy Scion Advisors said the transaction illustrates the drive toward consolidation in an overly-fragmented industry, and a focus on succession planning.

‘There are now so many suppliers, and so many wines that it’s hard for even strong brands to attract the attention of a distributor.’

She noted that anything under a million cases can be a tough sell. Foley’s total production is said to be 800,000.

‘Foley is the type of buyer who is looking for more muscle,’ said Steinthal. ‘But this is a strategic purchase, for ‘halo effect’.’

If achieved, the estimate of $100m for Chalk Hill (cited by local press) would place the transaction among the most highly valued in recent years.

According to a survey conducted by Scion Advisors, about 1000 privately-owned wineries on the US West Coast will seek to change hands by 2018, and of those, about half will look to family members.

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Written by Maggie Rosen