YOUNTVILLE — Vintage Wine Estates Inc. purchased some of the assets of the recently shuttered Cosentino Winery near Yountville and has brought back founder Mitch Cosentino to help “stabilize” the brand.
The Santa Rosa-based portfolio of brands, which includes Windsor Vineyards, Girard and International Wine Accessories, purchased the winery property, equipment, customer list for the 30,000- to 40,000-case brand and wine inventory from the senior creditor, a subsidiary of Physicians Reciprocal Insurers, on Dec. 30.
The purchase price wasn’t disclosed, but the seller financed $6.9 million, according to Napa County public records. The value of the property when it was appraised in February 2010 was $6.9 million, according to court documents.
Some of the wine and equipment are located in the Pope Valley and Lodi wineries Cosentino Signature Wines used to operate, and some of it is subject to grower’s liens that will need to be resolved via buyouts or turning over wine plus equipment and vendor liens, according to Pat Roney, president and co-owner of Vintage Wine Estates.
VinREIT, a St. Helena-based subsidiary of Entertainment Properties Trust, continues to own the Lodi and Pope Valley wineries.
Unpaid grape contracts totaled about $1.6 million at the time of the Oct. 18 bankruptcy court filing but now total around $800,000, according to Mr. Roney.
“It’s a bit of a mess to untangle and work through that,” Mr. Roney said Wednesday.
“This exciting acquisition provides us the opportunity to welcome another renowned Napa Valley Winery to our portfolio and is a significant step forward for Vintage Wine Estates,” said Pat Roney, Vintage Wine Estates president. “We look forward to upholding the Cosentino Winery tradition of producing exceptional, high quality wines and furthering our mission of cultivating small, hand-crafted artisanal wineries in Napa and Sonoma.”
Vintage approached the insurance company to purchase the winery because of its location, situated on the busy Highway 29 thoroughfare through Napa Valley and next to Mustard’s Grill, as well as the loyal following of the brand. The winery shut down in November.
Mr. Cosentino, who started the winery in 1990 and sold it to Cosentino Signature Wines, will be brought back as a brand “ambassador,” potentially helping out with blending the wine, according to Mr. Roney. In October Mr. Cosentino started a new small-scale wine venture in Napa called pureCru with grocer Don Held, commercial property developer and builder Jim Nylen and oncologist Prabhjit Purewal.
In a statement Wednesday, Mr. Cosentino called Vintage’s purchase “a historic turning point for Cosentino Winery.”
“Their impressive portfolio of ultra premium wineries, including Girard Napa Valley, Windsor Sonoma and Sonoma Coast Vineyards, ensures a continuing tradition of quality for Cosentino Winery,” he said. ” I am looking forward to working with this quality, long-term focused group to continue the well respected Cosentino wines.”
On Tuesday a U.S. Bankruptcy Court judge in Santa Rosa approved the sale of Cosentino’s liquor license to Vintage on Jan. 14 for $10,000, giving creditors 10 days to object, according to court documents. An attorney for the trustee in the two related bankruptcy cases told the court that Vintage was willing to pay a premium for the license to avoid having to wait as much as 60 days for the state to approve a new license, according to a filing and Mr. Roney.
“As matters stand, the trustee is faced with a bankruptcy estate where the liquor license has turned into the only known asset of the Cosentino Winery estate,” wrote San Francisco-based attorney Reidun Strømsheim.
The transfer of licenses would allow the winery and its tasting room to reopen, which is targeted for Jan. 21, according to Mr. Roney.
Physicians Reciprocal Insurers took back the winery property in a Dec. 29 trustee’s sale when no one bid more than the $10.55 million outstanding on $12.6 million in loans to Cosentino Signature Wines Plc and Cosentino Winery LLC dating to 2005, according to court filings. The vintner defaulted on the loans starting in February 2009 but were given several forbearances through March of this year. The insurer demanded payment in July and filed a notice of default in August.
The subordinate secured creditors, CSW Lender L.P. and CSW Sub Lender L.P., claimed $6 million in loans from 2007.
Other claims are pending in bankruptcy and county courts.
CORRECTION, Jan. 6, 2011: Creditors have 10 days from Jan. 4 to object to the transfer of the liquor license to Vintage Wine Estates.
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