There’s nothing worse than somebody being smart after the event. But since I’ve been arguing for some not inconsiderable time that Australia’s major wine stocks were grossly undervalued, I’m going to spare myself the guilt. Unless a better offer is forthcoming – which is exceptionally unlikely – BRL Hardy Ltd will become part of the new Constellation Wines for $10.50 a share. Most share analysts were predicting a sale in the region of $6-8.50, which again supports my view that there exists a substantial gulf between their perception of the wine industry and day-to-day reality. Sure the buyer was paying American dollars, which might be seen by some to be a reason the buying price was so high. But the reality is that the only likely purchasers of our major wine companies are going to be paying in American dollars, pounds Sterling or Euros. It will be interesting to watch if there is a re-evaluation of other major Australian wine stocks in the aftermath. Nothing like being wise after the event!
