Britain’s biggest winemaker could be sold as it tries to meet booming demand for English fizz.
Chapel Down has launched a strategic review to explore ways to find fresh funding to pay for its ambitious growth plans.
Options include raising cash from current or new investors – or even hoisting the for-sale sign over its Kent headquarters in Tenterden.
It is understood that the Chapel Down board would be open to a range of buyers, from private equity groups and champagne houses to wealthy individuals.
The firm has enjoyed huge success in recent years as appetite for English sparkling wine soars.
Growth plans: Chapel Down, led by chief exec Andrew Carter (pictured), has launched a strategic review to explore ways to find fresh funding
The group, set up in 2002, sold a record 887,000 bottles last year, with profits surging 87 per cent to £2.3million.
It has been publicly listed since 2003 but joined AIM in December in what chief executive Andrew Carter said was part of the company’s ‘evolution’ from ‘a start-up into being England’s leading and largest winemaker’.
The board – which includes City tycoon and Conservative Party donor Lord Spencer, who is Chapel Down’s biggest shareholder with a 26 per cent stake – is pushing ahead with a strategic review to cement ‘profitable growth in the long-term’.
Chapel Down already has plans for new vineyards and a winery as well as major investment in its headquarters.
The site has been a big money-spinner and welcomed 65,000 tourists last year for wine tastings and tours.
Chapel Down – whose bottles of English sparkling wine start at £30 – owns around a tenth of the UK’s 10,000 wine growing acres.
Even though 95 per cent of Chapel Down is guzzled in the UK, the firm is keen to expand overseas.
Carter told the Mail last year that the US market is of particular interest thanks to the American love for all-things British.
A Chapel Down spokesman said yesterday: ‘The board believes that it is now appropriate to review the full range of long-term funding options that support this plan.’
And analysts appeared to agree with this assessment.
Russ Mould at broker AJ Bell said: ‘Chapel Down has made a name for itself over the years but the business appears to have a hit the ceiling in terms of scale.
To grow even more, it really needs a big slug of cash to invest in the business and that might be better coming from a new, bigger owner, rather than going cap in hand to shareholders on an ad hoc basis.’
Wine is the UK’s fastest growing agricultural sector with business booming at the likes of Chapel Down as well as rivals Nyetimber and Gusbourne.
The chalky soil in the south-east of England is similar to that found in the Champagne region of France.
Warmer temperatures in recent years have meant higher sugar content in the grapes, which makes for higher alcohol levels.
Taittinger became the first Champagne house to invest in English sparkling wine in 2015 when it snapped up land near Chilham in Kent.
LVMH – the company behind world-leading champagne brands Moet & Chandon and Veuve Clicquot – has also been eyeing up plots on British soil.
Aside from Kent, West Sussex and East Sussex are also becoming key pillars of the growing English wine market, where the process from planting a vine to pouring a glass of bubbles takes at least seven years on average.
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