Managed by management services company, Strategy Partners the new venture will be known as Cape Coastal Wines (CCW) and will initially concentrate on the United States where an office will be established within the next twelve months.

CCW now also owns Cape Wine Cellars, proprietors of the Kleinbosch brand.

Newly appointed chairman, Johann Pieterse, who rose to prominence after he turned around Teljoy and Naspers's Van Schaik Bookstores, said the new company would initially concentrate on doing extensive market research in the United States in order to get a clear picture of which wines Americans prefer. 'Once we know exactly which style of wines the US market requires, the five cellars in the group will then be able to produce wines to exactly meet those needs.'

Boland Cellar chairman, Jannie Le Roux who was the prime mover behind the new venture, said a thorough study of the markets which the new company was targeting had been done. 'It is clearly evident that South Africa lags far behind countries like Australia, New Zealand and South American countries such as Chile and Argentina.'

In addition to the marketing company, a production company known as Cape Coastal Vineyards has been established to supply Cape Coastal Wines. This company will be chaired by Jannie Le Roux. 'A feature of this venture will be that it will bring on board a major Black Economic Empowerment (BEE) shareholder ', Le Roux said. Twenty six percent of the shareholding of Cape Coastal Wines have been set aside for BEE and negotiations were underway with potential investors. 'This deal will really open up the wine industry to South Africa's historically disadvantaged population,' he said.

The five cellars that will control Cape Coastal Vineyards are Wellington, Wamakersvallei, Bovlei, Riebeek and Boland. Cape Coastal Vineyards in turn holds a forty percent shareholding in the marketing arm, Cape Coastal Wines. Eight percent of the total shareholding in Cape Coastal Wines have been set aside for outside investors.

Strategy Partners, which has been engaged to manage Cape Coastal Wines, has been allocated a twenty six percent shareholding, placing it on equal terms with the twenty six percent reserved for the potential BEE partner. Cape Coastal Vineyards will supply Cape Coastal Wines 'in perpetuity', Le Roux said.

Pieterse, who is executive chairman of Strategy Partners in addition to heading up Cape Coastal Wines, said the project has generated a great deal of excitement in wine circles. 'We know the market is out there and we know we have the product to compete effectively. Because all of the stakeholders are insistent that it needs to be a market pull initiative, giving the market what it wants rather than trying to change consumer tastes and habits, we are all confident that the venture is going to be a shining success.'

There will be a strong emphasis on branding and to that end, a market research initiative has been launched to develop suitable brands for the US market. The five wine cellars involved in the new initiative have all undertaken to produce products in line with the results of market research. Target markets will determine price, quality and quantities required.

'There is no question in my mind that South African wines in terms of price/quality are among the very best in the world,' Le Roux said. A huge advantage of the new venture is the fact that the marketing company is largely 'virtual'. 'There will be minimal expenditure on bricks-and-mortar-type structures. Everything can basically be managed from our offices and at the vineyard/cellar level,' Le Roux said.

Cape Coastal Wines' Board of Directors will include some well known Cape businessmen. They are Johann Pieterse, Jannie Le Roux, Johan Strümpfer, Martin Malan and CN Louw.

Media queries: Johann Pieterse
Tel: 021 914 0486 or
Jannie Le Roux
Tel: 021 863 3905

Issued by: Media Services
gpieterse@mediaservices.co.za