Chapel Down considers sale amid expansion plans
Leading English wine producer Chapel Down has revealed it will undertake a strategic review to explore funding options for its ambitious long-term growth strategy. This plan aims to secure significant investments for new vineyards, a state-of-the-art winery and the enhancement of its brand home in Tenterden.
The new purpose-built winery, pending planning permission, is set to be operational by the 2026 harvest. Given the timeline and scale of these investments, Chapel Down’s board has deemed it appropriate to review a comprehensive range of long-term funding options.
“As part of the review, the board will consider all alternatives, including investment from existing shareholders, investment from new shareholders, a sale of the company and other relevant transactions,” the winery stated.
Chapel Down, part-owned by billionaire Lord Michael Spencer, has shown remarkable resilience and growth. The company is on track to achieve double-digit sales growth in 2024 and maintains a strong balance sheet with significant headroom in its existing £12m debt facility, which has been agreed in principle to be extended and increased.
Despite this optimistic outlook, the board emphasised that there is no certainty that a transaction will occur, nor any specific terms for a potential deal. Rothschild & Co has been appointed as the lead financial adviser for the strategic review.
Over the past decade, Chapel Down has seen its group sales climb by a third to £17.2m. It remains the largest domestic producer of English sparkling wine, producing 887,000 bottles last year – a 12% increase despite a 10% rise in the average selling price.
The announcement comes amid a flourishing period for English and Welsh wine, marked by a record-breaking harvest in 2023, which was 50% larger than the previous record year. The top 25% of vineyards averaged 15.60 tonnes per ha, with top grape varieties like Chardonnay, Pinot Noir, Meunier and Bacchus performing exceptionally well.
The English wine sector has also seen increasing investment from international players, including French Champagne houses like Taittinger, which purchased land in England for vineyards in 2015. More recently, Spain’s Henkell-Freixenet acquired Bolney and last year, Jackson Family Wines became the first US producer to buy acreage in Essex.
As the hectarage dedicated to vineyards has grown by nearly 75% over the past five years, and with the area in production now over 1,000 ha higher than in 2018, Chapel Down's strategic review and potential sale could further position the company at the forefront of this booming industry.
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56-58 Church Walk, Burgess Hill, West Sussex, RH15 9AN
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