Foley Family Wines buys Chateau St. Jean in Kenwood

Foley Family Wines of Santa Rosa announced Wednesday it has bought Chateau St. Jean with the intention of bringing the Kenwood winery back to its former glory as one of the crown jewels of the Sonoma County wine industry.

Foley bought Chateau St. Jean from Australia-based Treasury Wine Estates, which was previously part of Foster’s Brewing Group that had owned the beloved local winery since 2000. The winery was founded in 1973, and its first vintage made on the property was two years later with legendary winemaker Dick Arrowood, whose work was later followed by winemaker Margo Van Staaveren.

The deal, for which a purchase price was not disclosed, includes the historic 1920s chateau, a 6,000-square-foot visitor center, a 39,000-square-foot wine production facility and 79 planted acres of estate vineyards.

Founder Bill Foley said he wants to revive the brand that was a pioneer in the production of single-vineyard chardonnay wines from Sonoma County and was the first Sonoma wine to win Wine of the Year from Wine Spectator magazine in 1999 for its flagship Bordeaux blend Cinq Cépages.

About five years ago, production at Chateau St. Jean was moved to Treasury’s Beringer facility in the Napa Valley. Foley said he has plans to start up the winery again that has a permit to produce 750,000 cases annually.

“Treasury didn’t do it any favors,” Foley said in an interview. “It’s really to start making a lot of single-vineyard chardonnays and pinot noirs and to get Cinq Cépages back to where it was a 100-point wine at one point. … It’s really going to be a focus back to what Chateau St. Jean used to be.”

Foley Family Wines was ranked as the 18th-largest wine company in the country last year by Wine Business Monthly, producing 1.5 million cases. The company’s portfolio includes Chalk Hill Estate Vineyards in Healdsburg and Ferrari-Carano Vineyards and Winery in Healdsburg, which it bought last year and which became the biggest label in its portfolio.

In recent years, Foley has been aggressive in buying North Coast properties, though this is his first purchase this year amid major mergers and acquisitions activity.

Two local companies, the Duckhorn Portfolio and Vintage Wine Estates, became publicly traded companies this year to fuel their growth, while E. & J. Winery of Modesto completed an $810 million acquisition of low-price wine brands from Constellation Brands Inc. at the beginning of the year.

Foley Family Wines did shed its wholesale business unit, Epic Wines & Spirits of Santa Rosa, in February to Southern Glazer’s Wine & Spirits in Miami, the nation’s largest wine and spirits distributor, to concentrate more on wine production.

Foley said he would like to do about five more deals in the future; however, it likely won’t involve additional Sonoma County facilities.

“We got a good presence in Sonoma County, but we need a little more presence in Napa,” he said.

His company has three Napa labels, including Foley Johnson.

Foley added he has explored taking the route of having Foley Family Wines become a publicly traded company. But he has reservations about whether that is the right model for a winery business, given how Wall Street can punish a firm for missing a quarterly earnings target.

“If you miss earnings or revenues one quarter or two, you really get punished,” Foley said.

He noted that privately held companies have more flexibility to invest in such things as refurbishing a tasting room or revamping a direct-to-consumer program — things that may not generate quick returns but are essential for long-term growth.

“If you’re a private company, you can do what you want,” Foley said.

Chateau St. Jean’s legacy use permit will also be transferred to Foley Family Wines and will allow for 24 special events annually and an additional six large-scale events that include weddings.

You can reach Staff Writer Bill Swindell at 707-521-5223 or bill.swindell@pressdemocrat.com. On Twitter @BillSwindell.

Editor’s note: The story has been updated with correct amount of the E. & J. Winery purchase earlier this year.