One of Australia’s largest wine businesses Accolade will merge with Pernod Ricard’s Australian, New Zealand and Spanish wine businesses in a deal that will pull prominent South Australian brands under one umbrella.

Australian Wine Holdco Limited (AWL) – a consortium of investors that took full ownership of Accolade earlier this year – announced the merger this afternoon.

AWL said the merger would create a combined business with “a more diversified portfolio of highly complementary old and new world wine labels, operations in every continent, and be in a better position to meet the challenges facing the wine industry”.

The deal is subject to regulatory approval and is expected to close in the first half of 2025.

AWL said terms of the deal, including the price paid for the assets, were “commercial in confidence”, however Pernod Ricard made more than €12 billion (AUD$19.5 billion) in consolidated sales in FY23.

The Pernod Ricard portfolio features some household names, including South Australia’s Jacob’s Creek – a subsidiary of Orlando Wines which has been owned by Pernod Ricard since 1989.

Other Pernod Ricard brands include South Australian label St Hugo and New Zealand brands Stoneleigh, Brancott Estate and Church Road. The Spanish assets included in the deal are Campo Veijo, Ysios, Tarsus and Azpilicueta.

Accolade’s portfolio includes SA brands Hardys, Grant Burge, Banrock Station, St Hallett and Petaluma.

AWL comprises funds backed by existing Accolade financial partners Bain Capital Special Situations, Intermediate Capital Group, Capital Four, Sona Asset Management and Samuel Terry Asset Management.

AWL spokesperson Joshua Hartz – a partner of global investment firm Bain Capital – said both Accolade and Pernod Ricard had a “long, proud history as world-class wine producers”.

“Combining Accolade Wines with the Pernod Ricard assets will create a more certain and financially sustainable future for the business, allowing us to better serve our customers, in more segments and more geographies,” Hartz said.

“Backed by AWL, the combined business will be better able to adapt to changing consumer tastes and meet the structural challenges facing the global wine industry.

“AWL will work with relevant regulators to progress the combination, and if approved, support management to focus on a smooth future integration of the business.”

Pernod Ricard said the sale of the wine brands would “further strengthen its premiumisation strategy and to direct its resources to its portfolio of premium international spirits and champagne brands that drive the growth of its business”.

“The transaction is the result of Pernod Ricard’s continuous assessment of its strategic opportunities, in line with its longstanding policy to deliver sustainable value for its shareholders, employees, clients and partners,” Pernod Ricard said.

“With this transaction, Pernod Ricard will sell its wine division to a player of global scale, with a route to market solely dedicated to the wine industry.

“Its wine brands will benefit from the focus required to achieve their potential, reinforce their position, and seize new opportunities around the world.”

For Accolade, the deal follows the disillusion of merger talks between it and listed South Australian wine business Australian Vintage which owns Nepenthe and Barossa Valley Wine Company.

The merger withered on the vine in May when Australian Vintage told shareholders that Accolade said it was “not in a position to continue discussions further at this time”.