California Cooler to Be Sold for $146 Million

Two entrepreneurs in Northern California who created a wine punch several years ago that became known as California Cooler have parlayed that concoction into a deal worth about $146 million.

Their Stockton company, California Cooler Inc., said Tuesday that it is being sold to Brown-Forman Corp., a liquor company in Louisville, Ky., that markets several well-known brands of bourbon and wine.

The sale represents a huge bonanza for owners Michael Crete and Stuart Bewley, who founded the firm in 1981 in a run-down office building grandly dubbed the “Vintage Towers.” Today, California Cooler controls about 50% of the nation’s fast-growing, low-calorie “wine cooler” market.

Crete and Bewley will remain with California Cooler as chairman and president, respectively. Bewley said in a telephone interview that California Cooler needs Brown-Forman’s capital and expertise to meet increased competition.

“We’re No. 1 in the market, and we want to stay there,” Bewley said.

Terms of the sale call for Brown-Forman to pay California Cooler $55 million in cash and to pay off $8 million in current debts. Further payments will be made in cash over the next 35 months, with the exact amount contingent on company revenue. Contingency payments would total $83 million based on California Cooler’s current sales, the companies said.

California Cooler makes a punch-like mixture of wine and fruit juices that is chilled and carbonated. It’s packaged in bottles and usually sold in four-packs in the beer and wine sections of grocery stories.

Some of Brown-Forman’s best-known liquors include Early Times, Jack Daniel’s, Old Forester and Southern Comfort. It also markets Cella and Bolla wines.