While prospects for insolvency have captured the attention of those following the W. J. Deutsch's lawsuit against Ascentia Wine Estates (AWE), the process has unleashed a series of corporate mismanagement allegations against CEO Jim DeBonis.
"Eight Estates [a former name for AWE] may or may not be insolvent in a purely technical sense," said one source associated with the process. "But there is no denying that it has serious sales and financial problems, most of which result from executive mismanagement. That said, the company's only way out of its financial jam may be to file Chapter 11 in order to force debtors to restructure its debt."
That source, along with 17 others interviewed by Wine Industry Insight, spoke only upon a guarantee of confidentiality, some because they were not authorized to speak with the media and others fearful of "blowback."
"This is messy and going to get a lot messier before it's over," explained one source. "There will be collateral damage. People are going to get shot in the crossfire."
ALL SOURCES GIVEN OPPORTUNITY TO CORRECT & COMMENT
On Sunday evening, Wine Industry Insight emailed a draft of this article to DeBonis, Peter Deutsch and to all sources requesting corrections and additions by noon Monday. While not a standard WII practice, the shortcomings inherent in articles that rely heavily on unnamed sources demand an extra effort to insure a fair, accurate, complete and contextually accurate article.
Information from anonymous sources is never used by Wine Industry Insider unless it is corroborated by legitimate documents or by two or more independent sources.
Neither Deutsch nor anyone from his organization had any comment.
An email from DeBonis read, "Thanks for the opportunity, you definitely have your facts all wrong. I cannot get back to you by noon, but I will later on."
WIN had not received anything from DeBonis by 4:30 p.m. when this article was sent to subscribers,
In addition to its sources, Wine Industry Insight also relied upon W. J. Deutsch's legal complaint filed in Delaware Chancery Court.
DEUTSCH RAN OUT OF PATIENCE, FILED SUIT
"Bill Deutsch got tired of being ignored," said a source familiar with the controversy. "He felt stonewalled, lied to and believed that his legitimate concerns had been ignored. But you have to remember that he's also in litigation with another investment, Renwood Winery. I think he pulled the legal trigger so quickly on this one because he felt his patience with Renwood had been taken advantage of and he was not going to let that happen again."
"Even though WJD has a 27-percent interest, the rest is in the hands of Jim's allies, with GESD holding a whopping majority," said the source.
Ascentia acquired eight orphan Constellation Brands in June of 2008 as part of the $208,770,900 million deal that created AWE.
In that deal, all of AWE's land and wineries were acquired for $115 million by SBV VinREIT, an LLC operated by Kansas-City-based, Entertainment Properties Trust (NYSE:EPR). All the wineries and vineyards were then leased back to Ascentia.
VIP Subscribers click here to read the complete, un-redacted, 2,617-word original article.
Also In This Article:
The full text of the following sections is available to
VIP Premium Subscribers).
- GESD PROVIDED BULK OF FUNDING, GOT HEFTY FEES
- GIRAUDO ONLY INVESTOR NOT SUED
- AGREEMENT KEPT DEUTSCH FROM PROPER DUE DILIGENCE
- IMPOSSIBLE FOR ASCENTIA TO MAINTAIN PREVIOUS SALES LEVELS
- DEBONIS SHOULD HAVE KNOWN ABOUT "INFLATED FINANCIAL PROJECTIONS"
- GESD THREATENED TO SUE IF DEUTSCH INVESTIGATED
- MEDIA GIVEN WILDLY CONFLICTING ASCENTIA SALES FIGURES
- ASCENTIA: NO STRATEGIC PLAN + INABILITY TO MOVE QUICKLY
- DEBONIS NO "FREDDIE FRANZIA"
- FINANCIAL WOES PROMPTED ATTEMPT TO SELL BUENA VISTA WINERY
- VINREIT NIXED BUENA VISTA SALE
- BUENA VISTA "LAME" BRAND HURT POTENTIAL SALE
- BUENA VISTA NOW MOTHBALLED, HOPING FOR CUSTOM CRUSH
- BARGAIN BASEMENT SALES OF WINE TO INVESTORS & INSIDERS PROVIDED STOPGAP CASH, DEPLETIONS
- ASCENTIA TOO "BIG CORPORATE" FOR OWN GOOD
- TOP EXECS FAILED TO HALT "TOXIC ENVIRONMENT"
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Wine Industry Veterans Murphy & Averill Launch New Company
Consulting, New Brands, and a Packaging Innovation in the Works
Windsor, CA – February 9, 2010 – Máire Murphy and Walt Averill have officially launched their second venture in the wine industry. Following long, distinguished careers in wine, the couple founded Sín É Wine Company in 2001 creating and developing several negociant brands, including Solex Chardonnay.
The company merged with Billington Wines in 2006, and after Billington’s demise in 2009, Máire and Walt reviewed many opportunities before deciding it was time to operate independently once again.
Máire says, “We have a very different perspective of the industry, especially given our most recent experience. A lot has changed in the 25 years we’ve both been involved in the wine business, so looking at it in a non traditional way has become more crucial than ever.”
In fact, Wines West will be launching a new, direct-to-consumer brand with an innovative Wine Club this Fall and is reviewing financing options for a second brand for the three-tier marketplace. Their creative energy has also led to a packaging innovation, which they hope to launch before the Summer bottling season.
Walt continues, “In the past, we would have held onto our unique ideas. Now, we are more open to marketing them to the entire industry.”
The product will be revealed once the trademark and patent process is completed.
Wines West is an innovative firm offering consulting services to wineries and suppliers to the industry as well as product development. With expertise in all aspects of the industry and a combined 55 years of industry experience, the company offers creative solutions to get businesses back on track.
For more information about Wines West and their services, please contact Walt Averill or visit their website at www.wines-west.com.
# # #
Contact: Walt Averill
walt@wines-west.com
707-484-4998
Posted by
lperdue
on Feb 9th, 2010 and filed under
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Oh great! These are two of the people who presided over the destruction of Billington Wines, including Havens, Solex, etc. Just the “distinguished careers” the industry needs!
I believe Solex was their own brand which they brought over from Sín É Wine Company. Why would they destroy their own brand? Walt and Maire are two of the most dedicated professionals in the wine industry.
Wishing them both a great success, looking forward to their new wines at my favorite store in Salem, Pamplemousse, not an industry insider just an imbiber of fine wines (and cheese) and friend of theirs.
The wine business is fortunate to have Maire and Walt. They are a credit to the industry. I have worked with both of them and would do so again.
Solex was their own brand and they had nothing to do with the failure of Billington.
I know they will be very successful in their new venture.
If Billington had only listened to Walt and Maire they’d still be in business today. Good luck to them in their new venture and let’s hope it includes bringing some new brands to market. Solex, Magnet and Ben Madigan were tasty and are sorely missed!
Sorry \Lou\, but you are so far off base!!!
Walt & Maire are two of the most knowledgeable, hard working and dedicated people that I have ever had the pleasure of knowing. If I was in need of consulting services or assistance with product development, I can’t think of any other people that I would trust more than them with my business needs. They truly enjoy what they do and have a great sense of humor, which is an added benefit for anyone working with them. I look forward to what I know will be a huge success for them in their new endeavors…and I can’t wait for the great wines!
I’m wondering why ‘Lou’ doesn’t use his real name here? Michael Havens.