Brian McGuigan Wines Ltd and Simeon Wines Ltd, which have become progressively closer since they married McGuigan’s vineyard resources and marketing skills with Simeon’s production facilities last year, are now to merge. The merger will create a A$436 million company which will become Australia’s fourth-largest listed wine producer and will be 50% controlled by each player. Simeon’s shareholders are to receive 10 McGuigan Wines shares for every 16 Simeon Wines shares they hold, which values Simeon Wines at A$229m. McGuigan is paying a nil premium, while Simeon shareholders are undoubtedly getting value from the merger. Simeon’s quality as a winemaker has been matched by its inability to create its own successful wine brands, while one might argue that much McGuigan’s success in the marketplace has been despite what it has hitherto managed to put inside glass. Key players in the deal are Brian McGuigan, managing director and 22% owner of the company that bears his name, plus Pernod Ricard, which owns 13.3% of Simeon via its complete ownership of Orlando Wyndham. Simeon presently makes wine under contract for Orlando Wyndham, Yalumba, US-based Gallo and the large British supermarket chains of Tesco and Sainsbury. McGuigan has already dropped the hint that he’s on the lookout for acquisitions in the South Australian regions of the Clare Valley, Coonawarra and McLaren Vale.
