Crimea’s historic Massandra winery may be sold

Crimean authorities have said they intend to privatise Massandra winery, once a favourite of the Tsars, but one major Russian wine producer has ruled itself out of bidding and any attempted sale would likely face protest from Ukraine.

Speculation about potential bidders for Massandra winery has been building after Vladimir Konstantinov, head of the Crimean parliament, earlier this year said there were plans to privatise the historic producer, which was founded in 1894 and also has one of the largest wine collections in the world.

A tender process was expected to take place in October and November this year.

Massandra, which has long had high-profile admirers – including Tsar Nicolas II – was recently passed from Russian federal control to authorities in the Republic of Crimea.

However, any attempt at privatisation would likely draw the ire of Ukraine and its allies.

Ukraine’s government previously managed Massandra but lost control after Russia’s annexation of Crimea in 2014. European Union officials said in a legal note dated July 2014 that Massandra’s assets had been ‘transferred contrary to the Ukrainian law’. In 2015, Ukraine officials accused Massandra of illegally auctioning vintage wines that were part of Ukrainian national heritage.

Massandra’s value has been estimated at RUB12 to 15 billion (US$180-250 million), according to reports.

One of the potential bidders was reported to be Boris Titov, a businessman whose family owns Russia’s largest winery, Abrau-Durso.

However, a spokesperson for Abrau-Durso told Decanter.com that the company was not a potential suitor. ‘Abrau-Durso is not interested in buying Massandra winery,’ the spokesperson said.

Other potential bidders for Massandra have been reported to be billionaire businessmen Arkady Rotenberg and Yuri Kovalchuk, although their interest has not been confirmed. Both men are believed to be close to Russian president Vladimir Putin and have been targeted by US Treasury sanctions since 2014.

Kovalchuk bought Crimea’s Novy Svet winery in late 2017 via Rossia Bank, in which he has a majority stake, according to The Moscow Times.

Any deal for Massandra could present extra risks in terms of western sanctions for the buyer.

However, Russian lawyers from the Bannikov and Partners law firm said that this might not deter potential bidders that have already been made subject to EU and US sanctions since 2014.

Additional reporting by Chris Mercer.