SND: Constellation Sells Value Wine Brands, Including Meiomi and Woodbridge, to the Wine Group

Constellation Brands has taken another big step in streamlining its wine stable to focus on luxury brands, selling a 12-million-case portfolio of mostly value-priced brands to The Wine Group for an undisclosed sum. The deal is subject to regulatory approval and is slated to close immediately after the end of Constellation’s fiscal first quarter ending in May. The news was first reported by Shanken News Daily (SND), a sister publication of Wine Spectator.

The Wine Group: Looking for Value

The Wine Group, known for brands like Franzia and Cupcake, is buying Meiomi, Woodbridge, Robert Mondavi Private Selection, Cook’s, Simi and J. Rogét sparkling wine. The deal also includes three related production facilities—one in Lodi and one in Monterey County, California, as well as the Simi winery in Healdsburg—along with 6,600 owned and leased vineyard acres throughout California.

“The addition of these assets will build on our commitment to being a consumer-led company, delivering a diversified portfolio that offers consumers exceptional taste, quality, and value for any occasion,” said Wine Group CEO John Sutton in a statement. The Wine Group is the second-largest wine company in the U.S. in volume terms, producing approximately 32 million cases per year before the deal, according to Impact Databank.

“There is no question the wine industry is evolving, but it is here to stay,” Amy Hoopes, the Wine Group’s chief commercial officer, told SND. “We are committed to responding to consumers’ evolving tastes and to deliver options for different occasions—from a casual meal at home to a celebration and everything in between. We’re excited to add new brands to diversify our portfolio.”

Constellation: Focusing on Luxury

For Constellation, its wine and spirits stable after the sale will still account for an estimated 5 million cases per year, tilted fully toward the higher end. Its wine lineup continues to include Napa Valley brands Robert Mondavi Winery, Schrader, Double Diamond, To Kalon Vineyard Company, Mount Veeder Winery and The Prisoner Wine Company. It also includes the My Favorite Neighbor family of brands from Paso Robles, Kim Crawford from New Zealand, Tuscan producer Ruffino Estates and Ruffino Prosecco, Sea Smoke from Santa Barbara’s Santa Rita Hills AVA and Lingua Franca from Oregon’s Willamette Valley.

“By reshaping our portfolio to center on the higher end following the close of this transaction, we’re continuing our long-term strategy,” Sam Glaetzer, Constellation’s EVP and president of Wine & Spirits, told SND. “This strategic evolution will allow us to sharpen our lens on the craftsmanship, provenance and unique stories that define the stellar portfolio we’re carrying forward—and the opportunities it presents for the future.”

There had been reports that Constellation would soon exit the wine business, which has been declining, so it could concentrate its efforts on its spirits and beer portfolios. Instead, it is further winnowing its wine focus to luxury brands. In 2021, the company sold most of its value portfolio to Gallo Family for $810 million.

Woodbridge and Robert Mondavi Private Selection are both offshoots of Robert Mondavi Winery. Constellation executives have long believed those value-priced brands were impacting the image of Mondavi as a luxury Napa wine. The company bought Meiomi from Joe Wagner in 2015 for $315 million after a meteoric sales rise. It built on Wagner’s success, growing production and expanding to other grapes besides Pinot Noir, but sales have dipped recently.

“Concentrating our wine and spirits portfolio in higher-growth segments remains an important element of our overall business strategy and complements our higher-end beer portfolio, aiming to ensure we continue to participate in more consumer occasions across beer, wine, and spirits,” added Bill Newlands, Constellation Brands president and CEO, in a statement.

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