Treasury Wine Estates (TWE) has announced a significant move into the Chinese wine market by acquiring a majority stake in Ningxia Stone & Moon Winery. This strategic investment, valued at approximately $27.5 million, underscores TWE's commitment to strengthening its presence in China and enhancing its luxury wine offerings. The acquisition includes 43 hectares of premium vineyards and a state-of-the-art winery, positioning TWE to deepen its engagement with local consumers and support the growth of the Chinese wine industry. The deal also bolsters Penfolds' multi-origin strategy, enabling the brand to produce high-quality wines that reflect the unique characteristics of the Ningxia region.

Enhancing Luxury Wine Presence in Key Markets

Treasury Wine Estates aims to bolster its luxury wine portfolio through this acquisition, aligning with its vision to expand in key international markets. The purchase of a controlling interest in Stone & Moon Winery not only enhances TWE's footprint in China but also solidifies its dedication to the country's burgeoning wine sector. CEO Tim Ford emphasized that this move is part of a broader strategy to invest in regions with growing consumer demand for premium wines. The company plans to leverage Stone & Moon's established reputation and production capabilities to introduce new, high-quality wines to the Chinese market.

The acquisition provides TWE with access to prime vineyard land in QingTongXia, an area renowned for its favorable climate and soil conditions. The winery currently produces several grape varieties, including cabernet sauvignon and marselan, which have already been incorporated into Penfolds' existing Chinese-origin wine production. With a modern facility capable of expansion and a cellar door experience, Stone & Moon offers TWE a platform to engage directly with consumers and showcase the best of Chinese viticulture. This strategic move will help TWE build stronger ties with local communities and stakeholders, fostering long-term growth in the region.

Penfolds' Multi-Origin Strategy Gains Momentum

The Stone & Moon Winery acquisition plays a crucial role in Penfolds' ambitious multi-country origin strategy, which seeks to source grapes from some of the world's premier wine regions. By partnering with Stone & Moon, Penfolds can now include Chinese-grown grapes in its luxury wine lineup, further diversifying its portfolio. Managing Director Tom King highlighted the importance of this investment, noting that it follows the successful release of Penfolds' first China-sourced luxury wine in 2023. The company plans to capitalize on the unique qualities of the Ningxia region, blending them with grapes from Yunnan to create distinctive wines that maintain Penfolds' signature style.

This partnership will accelerate the development of Penfolds' winemaking capabilities in China, drawing on the expertise of the local Stone & Moon team. The collaboration is expected to enhance Penfolds' ability to produce wines that resonate with both domestic and international audiences. Furthermore, the acquisition strengthens TWE's relationships with key industry partners, such as CADA, China's leading alcohol industry body. Together, they are working to promote the growth of the Chinese wine industry and position Penfolds as a global ambassador for Chinese luxury wines. The transaction, set to close in early 2025, marks a pivotal moment in TWE's ongoing efforts to shape the future of premium wine production in China.