Constellation Buys The Prisoner Wine Company for $285 Million

Less than a year after buying Meiomi, the company sees potential in the red blend Dave Phinney created

The Prisoner, with its distinctive Francisco de Goya etching label, has been a runaway success since its 2000 debut.

Originally posted on Winespectator.com by Mitch Frank - April 6th, 2016 - Photo above Courtesy Constellation Brands

Constellation Brands, one of the world’s largest wine companies, is investing big in California red blends, buying the brands of The Prisoner Wine Company from Huneeus Vintners. The portfolio includes five brands: superstar blend The Prisoner, as well as Saldo, Cuttings, Blindfold and Thorn. The transaction, expected to close this month, includes just the brands. The price is approximately $285 million.

“More than ever, consumers are seeking high quality, distinctive wines, and the portfolio we are acquiring from The Prisoner Wine Company delivers,” said Bill Newlands, president of Constellation’s wine and spirits division. “Our goal is to be a leader in the U.S. wine market and to continue to premiumize our portfolio. We continually look for opportunities to strengthen our position within this portion of the industry.”

The Prisoner is a modern-day wine success story, launched by Orin Swift founder Dave Phinney in 2000. Phinney crafted a contemporary version of the California field blend—Zinfandel with portions of Cabernet Sauvignon, Syrah, Petite Sirah and Charbono. The wine consistently earns outstanding reviews from Wine Spectator, and has appeared on Wine Spectator’s Top 100 list multiple times.

The California red blend category has grown dramatically since the first vintage of The Prisoner, with wine drinkers—particularly young ones—turning to blends with strong brand identities over varietal Merlot and Syrah. According to Nielsen, red blend sales grew 7.6 percent by volume in 2015. Sales have been even stronger for blends priced over $20. The Prisoner retails for $35 a bottle.

In 2010, Phinney sold the brand to Huneeus Vintners, owners of Quintessa, after growing it to 85,000 cases. Sources report the price tag then was $40 million. Huneeus has continued to expand the brand, increasing production to 170,000 cases last year.

“Our team—including employees, growers, distributors and winery partners—have created and built an exceptional portfolio of fine wines, and we are very proud of the success they have achieved in a relatively short time frame,” said Agustin Francisco Huneeus, head of the company. “Constellation’s market reach, business intelligence and access to high-quality grapes will enable the brands’ continued growth momentum.”

According to Constellation, winemaker Jen Beloz (who took over for Phinney in 2011) and her team will consult on the winemaking, but the company will move production to Napa's Franciscan Estate Winery.

This is the second major brand purchase by Constellation in less than a year. The firm paid $315 million for Joe Wagner’s Pinot Noir brand Meiomi last July. "This acquisition is the next step in our strategy," said Newlands, "enabling us to further capitalize on U.S. market trends that favor high-end wine brands."

The Prisoner Wine Company - March 2016

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