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Foreign investors move on Chile

Foreign investors are becoming increasingly interested in Chilean wineries.

This is due to a a combination of increased demand for Chilean Carménère and Saugivnon Blanc, and the global enconomic downturn.

‘A number of wineries and vineyards are on sale,’ Max Morales, a Chilean wine consultant who also brokers property deals, confirmed.

While small- to mid-range wineries have been hit by a shortage of credit, potential investors are seeing current exchange rates as a window of opportunity that may only last until the end of the year.

One dollar currently buys about 540 Chilean pesos, compared to last year when stronger copper prices meant a dollar would only buy about 430 pesos.

‘We are seeing investor interest from America, France, Spain and Portugal, and for the first time Argentina,’ said Colin Becker, mergers and acquisitions expert with PriceWaterhouseCoopers in Chile.

Becker said investors are being attracted by both better exchange rates, and a desire to add Carménère and Saugivnon Blanc wines to their export range. ‘No one is looking to sell in the local market, this is all for export,’ he added.

The main targets, said Becker, are small to mid sized properties, producing mid to premium quality wines.

At least one or two partnership deals or winery sales could be concluded by the end of the year, Becker predicted. ‘There is volatility and people want to be sure they are buying a viable business, but on the plus side Chile is a known quantity,’ he said.

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Written by Sophie Kevany in Lima, Peru

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