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Let’s TalkE. & J. Gallo Winery Acquires Massican, the First White Wine Producer in the Napa Valley
California-based white wines producer Massican is the latest acquisition of E. & J. Gallo Winery
E. & J. Gallo Winery, a global wines and spirits producer based in California, United States, acquired Massican, a winery producing premium white wines in California, United States, on August 30, 2023. This acquisition was the latest by E. & J. Gallo Winery to expand its luxury wine collection. It announced the acquisition just one day after acquiring Rombauer Vineyards, another premium wine brand.
Transaction Summary
Our Take on the Acquisition
E. & J. Gallo Winery (buyer) acquired Massican (seller) for its portfolio of Mediterranean-inspired white wines to position the Massican brand in E. & J. Gallo’s Luxury Wine Group. Massican is a winery that sources different grape species from various producers in Napa Valley. With this acquisition, the Massican brand will benefit from E. & J. Gallo Winery’s extensive vineyards and grower relationships, resulting in more cost synergies. Additionally, E. & J. Gallo’s distribution network and sales team will enable the Massican brand to expand its reach.
The Facts of the Acquisition
- Target: Massican is a winery based in California that produces Mediterranean-inspired white wines. It was founded in 2009 with 400 cases, at 12 bottles per case, in its first vintage, which had grown steadily to 7,500 cases, at 12 bottles per case, by 2022.
- Acquirer: E. & J. Gallo Winery has been expanding its portfolio by distributing wine for smaller companies, acquiring vineyards through acquisition, and securing the supply of grapes from growers. Its estimated sales in the United States are almost 100 million cases annually.
The Transaction
| Date: | August 30, 2023 |
| Price: | Undisclosed |
| Purpose: | To expand E. & J. Gallo Winery’s wine portfolio in the luxury or premium wine category. |
| Acquirer’s Statement: | John Irwin, E. & J. Gallo Winery Brand Manager – “Dan [Petroski, owner of Massican] makes great wine. That’s where it has to start, but credibility matters, stewardship matters, and all wine drinkers, from the collector to the novice, want an authentic experience. These are not typical wines, especially for California; they’re low in alcohol, high in acid, salty, and fresh. I think that’s because they’re an extension of Dan … there’s a humanity and vision to his wines.” |
Target/Seller: Massican
Company Information
| Target: | Massican |
| Website: | massican.com |
| Founded: | 2009 |
| Industry: | Alcoholic Beverages – White Wines |
| Type: | Private, Family-Owned |
| Employees: | 2-10 (Self-published on LinkedIn) |
| Locations: | Head Office: PO Box 86, St. Helena, California, United States |
Product Information
| Products: | Chardonnay – White wine from green-skinned grapes Annia – White wine made from a blend of Tocai, Robolla, and Chardonnay grapes from Napa Valley Gemina – White wine made from Animea Germina grapes Sauvignon Blanc – Popular white wine with flavors of lime, apple, passion fruit, and white peach |
| Market Reach: | United States |
Financial Information
| Revenue: | Up to USD $5.0 million (Unconfirmed source: ZoomInfo) |
| Revenue per Employee: | Between USD $500,000 and USD $2.5 million (i.e., between USD $5.0 million / 2 = USD $2.5 million and USD $5.0 million/ 10 = USD $500,000 – estimated based on the self-published number of employees and revenue from ZoomInfo) |
Did You Know?
Red wine is the most popular among Americans, at 69%. However, 65% said they also liked white wine, and 55% reported they drink rosé. The U.S. wine market reached $11.2 billion in sales revenue in 2022, and the estimated United States wine consumption per capita is 3.1 gallons per year.
Target/Seller Overview: Massican
Dan Petroski founded Massican in 2009 in California as Napa Valley’s first and only white wine winery. Inspired by Italy’s fresh white wines, Massican produces Mediterranean-style white wines. Massican has grown steadily from 400 cases from its first vintage in 2010 to 7,500 cases in 2022. For his work at Massican, the San Francisco Chronicle named Dan Petroski “Winemaker of the Year” in 2017, and Food & Wine Magazine named him one of the “Innovators of the Year” in 2022.
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Explore Your Options NowBuyer/Acquirer: E. & J. Gallo Winery
Company Information
| Buyer: | E. & J. Gallo Winery |
| Website: | gallo.com |
| Founded: | 1933 |
| Industry: | Alcoholic Beverages, Winery, Farmland |
| Type: | Private, Family-Owned |
| Employees: | 7,000 (Self-published on company website) |
| Locations: | Head Office: 600 Yosemite Blvd, Modesto, California, United States |
Product Information
| Products: | E. & J. Gallo’s portfolio includes more than 100 products. Wine – Alcoholic drink made from fermented grapes Spritzer – White wine mixed with carbonated or sparkling water Sangria – Red wine mixed with fruits or spirits Tequila – A distilled beverage made from the blue agave plant Whisky – Liquor made from fermented grain mash Brandy – Liquor produced by distilling wine Vodka – Clear, distilled spirit made from fermented cereal grains and potatoes Margarita – Cocktail consisting of tequila, triple sec, and lime juice RumChata – A cream liqueur made from rum, dairy cream, cinnamon, vanilla, sugar, and other flavorings |
Financial Information
| Revenue: | USD $5.3 Billion (2022) (Source: Forbes) |
| Revenue per Employee: | USD $757,142 (i.e., USD $5.3 billion / 7,000 employees = USD $757,142 – estimated based on the self-published number of employees and revenue from Forbes) |
Buyer/Acquirer Overview: E. & J. Gallo Winery
E. & J. Gallo Winery is a family-owned winery with 15 family members actively working in the business. Established in 1933 and headquartered in Modesto, California, E. & J. Gallo Winery remains a privately held and ever-growing company that employs more than 7,000 people worldwide.
The company offers a vast array of products comprising more than 130 brands, including table, sparkling, and luxury wines, beverage products, dessert wines, and distilled spirits like vodka, tequila, and brandy. Gallo is an exporter of California wine, with its products available in more than 100 countries. Also, it imports wines from Argentina, Chile, France, Germany, Italy, New Zealand, South Africa, and Spain. Additionally, Gallo imports spirits from Australia, the Caribbean, Italy, Mexico, the United Kingdom, and Venezuela.
E. & J. Gallo owns more than 20 wineries strategically located in wine regions throughout California, Washington, and New York and owns over 23,000 acres of vineyards across California and Washington. In addition, the company contracts with growers who supply grapes yearly.
The company has led the way in developing new environmentally friendly practices such as limiting the use of synthetic chemicals, fertilizers, and pesticides, recycling and reusing processed water, creating new wetlands, and protecting existing riparian habitats.
Previous Acquisitions by E. & J. Gallo Winery (Partial List)
- Rombauer Vineyards (2023) – A premium winery and vineyard based in California, United States.
- Hahn Family Wines (2023) – A 1,100-acre vineyard and estate winery based in California, United States.
- The Alixir Company (2023) – A zero-sugar canned wine company selling under the brand name Bev. The company is based in California, United States.
- Denner Vineyards (2022) – A 130-acre vineyard and estate winery in California, United States.
- Agave Loco (2021) – Owner of RumChata, a leading cream liqueur brand established in 2009.
- Pahlmeyer Winery (2019) – A winery based in Napa Valley, California, United States.
- Orin Swift Cellars (2016) – A winery established in 1998 in California, United States.
Sources
- Company Profile
- Other Sources
- Unconfirmed Sources
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