Vavasour aims to triple production

By IRENE CHAPPLE

Marlborough's Vavasour Wines, under the new ownership of investment vehicle the New Zealand Wine Fund, is raising money for expansion and is likely to list on the AX New Zealand Stock Exchange alternative within three years.

Vavasour was sold to the Wine Fund last year for between $10 million and $15 million and is heading towards a turnover of $7 million for the year to next June.

The Wine Fund, which now has 14 shareholders, was established by merchant banker David Belcher and former Montana Wines executive Peter Scutts.

Its aim is to buy small vineyards and inject cash for expansion.

Vavasour, the Wine Fund's first and so far only buy, is "quite profitable", said Belcher.

It is raising $4 million of private equity from New Zealand and overseas investors and Belcher said he was confident the money would be raised within the next two months.

It will be used to expand Vavasour's vineyard in Marlborough. The company is aiming to more than triple its production, from 60,000 cases a year to 220,000.

Listing on the AX is likely by 2007, although this could come earlier given the present market buoyancy, Belcher said.

Vavasour's main varietal is sauvignon blanc, although it also produces chardonnay, pinot gris and pinot noir. Almost half its product is exported to Britain, Australia and the United States.

Last year, the company's sauvignon won gold at the International Wine and Spirits competition in London. Last week it was the chardonnay that took gold.

Belcher said New Zealand chardonnay would always be a commodity product, "whereas we will always be known for our sauvignon blancs".