Australian Vintage Limited has announced the termination of CEO Craig Garvin’s employment and appointed non-executive director Peter Perrin as Acting Chief Executive Officer.

Australian Vintage said Garvin’s termination was “for engaging in conduct that, in its view, displayed a lack of
judgement and was inconsistent with the values of the company and the high standards expected of its Chief Executive Officer.”

Chairman of Australian Vintage Richard Davis said: “The Board thanks Craig for his service to the company over the past four years, and the contributions he has made to the business over that time.

“These include steering the company through the challenges of the COVID-19 pandemic and the development and execution of the company’s five-year strategic plan, which transformed AVG into a consumer-led branded business with a commitment to innovation.

“While we are disappointed by the circumstances leading to his departure, we believe this decision is in the
best interests of the company and its stakeholders. The Board remains committed to upholding the highest standards of conduct and accountability for all employees, including senior leadership.”

The Australian has reported that Garvin is considering a defamation and a possible wrongful dismissal case and spent Monday with his lawyers.

Sacking shocks major shareholders

The move comes at a critical time for Australian Vintage, during discussions regarding a merger with Accolade Wines.

The largest shareholder in Australian Vintage. Allan Gray, which holds a 17% stake in the company, is demanding answers from the Board.

Managing Director Simon Mawhinney told the Australian Financial Review: ““We are completely in the dark.”

“I do think this is the kind of thing to embolden Accolade to get a better deal than might otherwise have been the case.”

WAM Capital, which holds just under 5% of Australian Vintage, said it was equally blindsided.

Oscar Oberg, lead portfolio manager of WAM Capital, told The Australiaan: “We are extremely disappointed that it has come to this from the board and timing quite frankly is not ideal, it is bewildering,”

Discussions continue with Accolade

The company said the departure of Garvin should have no impact on the preliminary discussions between the company
and Accolade Wines on a potential transaction, as previously disclosed to the ASX on 26 February 2024.

“These discussions are continuing, although there remains no certainty that any transaction will eventuate.

Australian Vintage’s brands include McGuigan, Nepenthe, Tempus Two and Barossa Valley Wine Company.

Davis said there was no certainty of any transaction proceeding, but there were large efficiencies available should the groups join forces.

“There are a number of parts to the transaction,” Davis told the Australian Financial Review. “The crown jewel is the synergies.”

Search for new CEO

Accolade said an extensive global search process has commenced to appoint a permanent CEO.

The company said Perrin brings a wealth of high-level wine industry experience as a past manager and director
of a number of large listed, private and boutique wine companies in Australia, the United States and New Zealand over a 40-year wine career that focused on sales and marketing both in Australia and overseas. He is a trustee and honorary life member of the Wolf Blass Foundation.

Australian Vintage said it will pay Garvin his accrued entitlements and he will receive payment in lieu of his six-
month notice period in accordance with his employment contract. The unvested performance rights held by Garvin as at the termination of his employment will lapse. However, the 562,705 shares currently held in trust under escrow will be released from escrow and transferred to Garvin.

Australian Vintage eyes Accolade merger