The ACCC has announced it will “not oppose the proposed acquisition of Pernod Ricard Winemakers by Australian Wine HoldCo Limited, through its subsidiary Accolade”.

Accolade’s acquisition relates to Pernod Ricard Winemakers’ BrandCo division, which owns and manages a portfolio of Australian, New Zealand and Spanish wines including Campo Viejo, St Hugo, Church Road, Stoneleigh and Jacob’s Creek.

Accolade owns wine brands including Berri Estates, Grant Burge, Petaluma, Hardys and St Hallett.

“Based on our investigation, we consider the proposed acquisition is unlikely to substantially lessen competition in wine processing and packaging services, and similarly is unlikely to substantially impact competition in the wholesale supply of wine,” Dr Philip Williams said.

“We considered that if the acquisition went ahead, a number of other businesses will continue to offer competing processing services and also wine,” Dr Williams said.

Information and feedback gathered during the ACCC’s investigation also indicated that the acquisition is unlikely to substantially lessen competition in the market for the purchase of wine grapes.

“We found that the acquisition would not materially alter competition in grape acquisition markets where Accolade and Pernod Ricard currently overlap,” Dr Williams said.

Concerns relating to whether Accolade, following the acquisition, could disadvantage rival winemakers’ access to processing or packaging services were also examined by the ACCC.

The ACCC concluded that Accolade is unlikely to have the incentive or ability to engage in this conduct, and that even if such conduct occurred it would be unlikely to substantially lessen competition in the wholesale supply of wine.

The ACCC heard from a range of market participants, including grape growers, competing winemakers, wine retailers and industry bodies during its investigation.

AWL welcomes decision

AWL released a statement saying it welcomed the ACCC’s decision to grant merger clearance for the combination of Accolade Wines with Pernod Ricard’s Australian, New Zealand and Spanish wine businesses.

AWL is a consortium of international institutional investors which comprises funds backed by Bain Capital Special Situations, ICG, Capital Four, Sona Asset Management and Samuel Terry Asset Management.

The consortium said the combined entity would be a more efficient global wine business with a diversified portfolio of highly complementary old and new world wine labels.

“The combined business will have operations in every continent and be in a better position to meet the challenges facing the wine industry, providing a more certain and financially sustainable future for the business,” AWL noted in a media statement.

AWL spokesperson Joshua Hartz said: “We welcome the ACCC’s decision. We have worked closely with all stakeholders to progress this combination and today’s milestone takes us a step closer. Importantly, management are focused on preparations for a smooth integration of the businesses once the deal completes.”

“Both Accolade Wines and Pernod Ricard have a long, proud history as world-class wine producers. Combining Accolade Wines with the Pernod Ricard assets will create a more certain and financially sustainable future for the business, allowing us to better serve our customers, in more segments and more geographies. Backed by AWL, the combined business will be better able to adapt to changing consumer tastes and meet the structural challenges facing the global wine industry.”

The transaction remains subject to other customary closing conditions, which need to complete before the businesses can be combined.

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