UK-based vintner Chapel Down will continue to operate as a standalone company listed on the Alternative Investment Market (AIM), following completion of a strategic review.
In June, the sparkling wine maker said it would “consider all alternatives” including “a sale of the company” as it undertook “a strategic review of the options”.
The following month, Australia’s Treasury Wine Estates brushed off reports that had suggested it was looking to buy Chapel Down.
Following assessment of “a number of opportunities”, the English winemaker concluded on Friday (25 October) that "there were no transactions that would create superior long term shareholder value".
Consequently, the group is "no longer in an 'offer period' as defined in the Takeover Code".
In a statement, the company said: “The Chapel Down Board and team, have great confidence in the continued growth of the English wine region, which is underpinned by the quality of the wines being created.
Alongside the announcement, the winemaker noted that it expects its 2024 harvest to yield quality similar to the 2019 vintage, but with lower volumes as against 2023 and the five-year average.
Chapel Down has forecast a 2024 harvest of approximately 1,875t, down from 3,811t in 2023, and anticipates producing about 1.7 million bottles from the 2024 vintage.
Group operations director and head winemaker Josh Donaghay-Spire said: “Whilst the 2024 vintage has faced more difficult weather conditions in September, vintage conditions and grape flavours are reminiscent of the 2019 harvest which delivered great quality traditional method sparkling wine such as the recently released Grand Reserve 2019 and Blanc de Blancs 2019".
The majority of the 2024 harvest will be reserved for creating traditional method sparkling wine, the company added.
The reduced harvest is not expected to impact stock availability due to “strong” inventory from previous vintages.
In light of lower yields, the group has projected a low, single-digit decline in full-year net sales revenue compared to the previous year.
The smaller harvest could also lead to a non-cash charge ranging from £750k to £850k for FY24 associated with “fair value adjustments on biological assets”, the company said.
Chapel Down, which claims to own approximately 10% of the UK's total vineyard acreage, has a production capacity of up to three million bottles annually.
The latest development follows the resignation of Chapel Down CEO Andrew Carter in September after the wine group reported decreased half-year sales and profits.
Carter will depart early next year to join Yorkshire brewer Timothy Taylor’s.
