As reported today in Melbourne’s The Age newspaper, the experiment in wine investment known as the Australian Wine Exchange (AWX) will be wound up after its final class of wine shares are delisted on March 4 next year. Chief executive Stephen Thompson has written to shareholders saying the venture’s termination will not affect the rights and entitlements of wine class shareholders. The concept has deployed around $4 million of capital, and its investors have finally realised that their expectations were unlikely to be achieved. The OnWine site has featured the share prices of several of the wine class share offerings, and it is not difficult to observe that trading was rare. It would appear that buyers bought the wines at the discounted price in advance of their commercial release in order to take possession at the expiry of the two-year listing, rather than to trade. One might also surmise that for the shareowners to sell at a profit, the price they were asking was too high. In other words, the market was too small and too flat for the concept to succeed. While my comments about the AWX have been lukewarm since its inception, there is absolutely no joy in reporting the failure of a small business. It is to the credit of all concerned at the AWX that every commitment made to every purchaser will be honoured. Now, big business could surely learn from that!
