Australian retailer Woolworth’s has bought a stake in China’s future wine and drink needs.
The supermarket chain has acquired China-based Summergate Fine Wines and Spirits, a leading drinks distributor representing about 80 global brands.
It also includes a small fine wine retail business, Pudao, with two stores in Shanghai and Beijing, a well as a small online and direct retail operation.
China is the fastest growing export market for Australian wine, particularly red wine, and is valued at $217 million.
Summergate, with 13 offices and 11 distribution centres employing more than 400 people, was started in Shanghai in 1999 by American Ian Ford and New Zealander Brendan O’Toole who have agreed to remain with the business.
Woolworths CEO Grant O’Brien says this is a very small step into China
“We have a conservative investment lens, particularly in relation to international acquisition opportunities,” he says.
Woolworths also wants to use Summergate to launch its Langton fine wine auction business in China.
A purchase price hasn’t been announced. Woolworths says the acquisition won’t have a material impact on its results.