Constellation Sells 2 Wineries

Constellation Brands Inc., the world’s largest winemaker, sold California’s Arrowood and Byron wineries Tuesday to Legacy Estates Group for $40 million as it trims assets after the purchase of Robert Mondavi Corp.

The sale includes all inventory, grape contracts and vineyards associated with the Arrowood, Grand Archer, Byron and IO brands, Fairport, N.Y.-based Constellation said. The brands were among those Constellation gained in December in its $1.03-billion purchase of Oakville, Calif.-based Mondavi.

Constellation has enough vintners making wines for $20 a bottle and above without Arrowood and Byron, spokesman Mike Martin said. The winemaker acquired Mondavi to gain luxury labels including Opus One as well as mid-priced brands including Woodbridge. The asset sale was begun before Constellation bought Mondavi.

Shares of Constellation fell 49 cents to $52.18 on the New York Stock Exchange. Constellation said $20.5 million of the price would be paid to a third party to satisfy obligations from Mondavi’s original purchase of the wineries.

The four brands sold 87,000 cases of wine annually. Arrowood is based in Sonoma; Byron is in Santa Maria. Closely held Legacy Estates, in St. Helena, owns the Freemark Abbey Winery.