Lion Nathan sells WA winery to Fogarty

Lion Nathan has sold its only Western Australian winery, Smithbrook Vineyard in Pemberton to the Fogarty Wine Group for an undisclosed sum.

The country's second biggest brewer, with labels including Toohey's and Hahn beers and various wines, will retain ownership of the Smithbrook brand and will continue to market and produce wine under the Smithbrook and Yilgarn labels.

However, the vineyard along with the 1000 tonne production facility on the site will go to Fogarty, bringing its total capacity up to 2,500 tonnes.

Fogarty owner, Peter Fogarty believes Lion Nathan's motivation to sell is related to removing managment obligations in Western Australia.

"We understand that they (Lion Nathan) were not interested in retaining ownership so far away from its base," Mr Fogarty told WA Business News.

"They didn't want to maintain management obligations in WA."

Mr Fogarty said discussion between the companies began before this years' vintage when Fogarty was purchasing some of the Smithbrook fruit.

"We bought some fruit and saw the quality and then heard about the sale, and then heard the sale was off and weren't really sure," he said.

"We spent more time at the winery...and were attracted by the quality of the site.

"Lots of work had gone into different clones on it with lots of different wines.

"And it grows the best savvy (sauvignon) and erlot in WA."

Mr Fogarty expressed a keen interest to explore some Italian varieties on the property and intended to look closely at chardonnay next vintage.

Full announcement below:

Sale of Smithbrook Vineyard and Winery

Lion Nathan Wine Pty Limited ("Lion Nathan") yesterday completed the sale of its Smithbrook Vineyard and Winery to Terroir Investments Pty Ltd ("Terroir"), a company associated with the Fogarty Wine Group (FWG).

Under the terms of the sale, Lion Nathan retains ownership of the Smithbrook trade name and trademarks and will continue to produce and market the Smithbrook range of wines .

Terroir will supply wine from grapes grown at the Smithbrook Vineyard to Lion Nathan under a long-term bulk wine supply agreement.

The Smithbrook Vineyard is recognised by Ray Jordan in his 2009 WA Wine Guide as producing the very best Sauvignon Blanc and Merlot in Western Australia.

FWG had purchased fruit from Lion Nathan in the 2009 vintage and through this relationship the parties ultimately negotiated the sale.