Bank of Montreal Targets Winery Acquisition Market

A leading Canadian bank has set its sights on becoming a major player in the financing of winery acquisitions. The Bank of Montreal (BMO) has partnered with a California-based merger-and-acquisition firm, Zepponi, known for advising prominent companies like Constellation Brands and E. & J. Gallo on their winery and vineyard purchases.

This strategic alliance aims to position BMO as a key financial advisor and service provider in the wine industry, specifically targeting high-profile wine clients. Adam Beak, head of BMO’s wine and spirits group in Napa, stated, “We are even more focused on being the finance source and the advisory source for wine transactions, for wineries buying and selling each other.” As part of this initiative, BMO plans to expand its team to better support its new role.

BMO’s intensified interest in the wine sector follows its substantial US$16 billion acquisition of Bank of the West, which Adam Beak described as a move that has “opened up new opportunities” for the bank. “We had kind of reached the ceiling with what we could do at Bank of the West. And this acquisition has just really opened up opportunities,” Beak elaborated.

The wine industry has witnessed significant business activity in 2024, with numerous acquisitions transpiring in recent months. Earlier this month, the completion of a transaction valued at approximately US$1.95 billion saw Duckhorn becoming a privately held company. Duckhorn’s CEO, Deirdre Mahlan, remarked that this development is “excellent news” for shareholders who “will receive a substantial premium.”

Further notable transactions include the January 2024 acquisition estimated at US$99 million and Pernod Ricard’s sale of brands such as Jacob’s Creek and Brancott Estate confirmed in July. Treasury Wine Estates also announced plans in August 2024 to divest some of its lower-cost labels, including Wolf Blass and Blossom Hill. Additionally, Marchesi Antinori, one of Italy’s oldest family-owned wine producers, acquired a significant stake from Ste Michelle Wine Estate in June.