In late September 2002, Walt Klenz was deciding whether Beringer Blass Wine Estates should pursue internal growth via development of its current premium wine brands or external growth via acquisitions of new brands. Klenz was ending his first year as Beringer Blass's managing director and twelfth year as Beringer's President.
Two years earlier, he had overseen a merger between the Australia-based Foster's Brewing Group and California-based Beringer Wine Estates, a move that had triggered a wave of similar consolidation transactions around the world of premium wines. Rumors abounded in the industry that larger rivals such as E. & J. Gallo, Constellation, and Diageo were actively seeking acquisitions of premium wineries to increase global market share.
As Klenz (rhymes with "cleanse") prepared his notes for a presentation called "Globalization of the Wine Industry" to over 300 attendees at an annual wine industry conference in Napa, California, he privately wondered how he was going to guide Beringer Blass towards globalization in the future.
DSC02837, Beringer Vineyards, Napa Valley, Califor...
Beringer Vineyards, Napa Valley, California, USA
Beringer Vineyards, Napa Valley, California, USABeringer's historyIn 1875 two German emigrants, Jacob and Frederick Beringer, purchased property in St. Helena, California, for $14,500. During the following year, Jacob began working his new vineyards and started construction of a stone winery building. He employed Chinese laborers to build limestone-lined aging tunnels for his product. In 1880, Frederick opened a store and a wine cellar to accommodate the sale of wine in New York. The Beringer Brothers commenced an education and marketing program to introduce Napa Valley wine to the East Coast market. Their specialty, even in those early years, was premium table wines.
Beringer family members continuously owned the winery until 1971, when they sold it to the Nestlé Company, which renamed the Beringer subsidiary "Wine World Estates." Over the next 25 years, Nestlé hired management to implement an expansion strategy that included purchase...