Heublein Inc., the nation’s third-largest wine company, said Tuesday that it will acquire Glen Ellen Proprietor’s Reserve, one of the nation’s most successful lines of lower-priced premium wines, from Benziger Family Ranch Associates.
No sale price was announced, but industry analysts estimated that the deal cost Heublein, a division of Grand Metropolitan of England, about $60 million.
The acquisition places Heublein almost dead even with the second-largest U.S. wine company. Canandaigua Wine Co. of New York, with its recent acquisition of Vintners International, became No. 2 with shipments of about 20 million cases. E&J; Gallo Wine Co. of Modesto remains the world’s largest winery, with shipments of more than 65 million cases in 1992.
Included in the Heublein acquisition are the Glen Ellen brand, the nation’s ninth largest at about 4 million cases of wine sold last year; the smaller M. G. Vallejo brand and a huge blending, bottling and shipping warehouse in Sonoma.
The Benziger family retains its upscale Benziger and Imagery brands, which produced about 100,000 cases last year, as well as the Sonoma Mountain winery and vineyards.
“The family wanted to expand the Glen Ellen brand over the last couple of years, and there just wasn’t enough capital out there to do it,” said an industry analyst who asked not to be named. “Also, they were getting some pressure from the bank to pay down some of their debt.”
The analyst said the family had been thinking about selling the Glen Ellen brand and using the proceeds to expand the Benziger line for more than a year. Shipments of Benziger wine rose 120% in 1992 compared to 1991.
The Heublein deal parallels one made a year ago by Brown-Foreman of Kentucky, in which the large, distillery-owned company acquired the Fetzer Vineyards brand.
Heublein, based in Connecticut, also markets wine under the names Inglenook, Beaulieu, Almaden and Blossom Hill.