Chatom Winery

in the Sierra Foothills situated on 32.44 acres.

Client Description:

The owner built the winery in 1990 and also purchased 744 acres of land with 64 acres of vineyards to supply the winery with fruit. This was a labor of love that had run its course and she wanted to sell the winery and retire to the ranch and continue growing high quality grapes to sell to Napa Valley wine producers and local wineries.

Situation:

As with most smaller wineries, they are not able to be sold as businesses based on capitalizing the ROI. Instead they are sold based on asset value and a new owner most likely will be operating the business at a loss until a more robust distribution plan, wine club membership & tasting room sales increase. It is critical that small wineries sell the majority of their products direct to consumers due to the much higher profit margins.

Problem:

Due to the location approximately 2 ½ hours from the premiere wine regions of Napa and Sonoma it is a challenge convincing potential buyer that premium wine is produced at the facility, and that visitors travel to this area for wine tasting and buying these fine wines.

Solution:

We partnered with an international auction firm who conduct live & remote bidding and handle the marketing throughout the United States.

Outcome/Benefit:

The auction was well attended, and the winery was sold to one of the attendees.

The process of auctioning with a time definite offer and closing was very efficient. Due diligence in an auction is performed prior to the bidding process and closing occurs much quicker.