New M&A fund aims to unite wine lovers and investors

Bringing together wine connoisseurs and investors is the objective of a new Chinese M&A fund.

"Our goal is to create added value for venture capital and investment, by building a bridge among investors, wine producers and consumers," Kelvin Li, executive president of Chateau Segonzac International Group Co Ltd, said in a release Monday.

The company employs a "fund to business to customer" model, an approach that focuses on the relationships between venture capital, wine producers and consumers.

The company also owns Bordeaux, France-based winery Chateau Segonzac and is looking to purchase more high-quality wineries worldwide, including in the United States and Italy, in 2017. Segonzac said it hoped to bring its Sino-French-made wine into the US market while it looks to acquire or merge with top wineries in the United States.

"Investors need returns, wine producers need a sales channel and consumers need to have as many choices as possible, and this is what Chateau Segonzac International is dedicated to," Li said.

"It serves as a giant platform to connect investors, producers and consumers. Segonzac aims to integrate wine culture with venture capital, creating a new path of development for the wine-dealing business."

Li said the company is also dedicated to introducing world-class, affordable wine to Chinese consumers.

On Dec 29, the company advertised on the Nasdaq Stock Market's giant LED billboard in Times Square in New York.

Founded in 1887, Chateau Segonzac is one of the oldest chateaus in France. It has a 40-hectare vineyard yielding cabernet sauvignon, merlot and malbec grapes.

Chateau Segonzac International is based in Hong Kong. Its original focus was to acquire the French winery and start the winery investment fund.

Another investor in Segonzac is wine trader Austchi Dragon. Registered in Australia in 2004, Austchi set up a branch in Shenzhen, Guangdong province, in 2007. The Shenzhen unit is an authorized trader for a number of famous wine brands in Australia and France.

The fund is coming along at an auspicious time for the wine industry in China.

China Daily's Mike Peters covered Wine Vision, an annual forum for the industry, hosted in December by Sonoma County in California.

Edouard Duval, CEO of Shanghai importer East Meets West, told the global wine professionals that while there's less ganbei in China these days due to a government crackdown on extravagance and gift-giving, the number of Chinese who drink wine at least once a week is up 35 percent.

"These are people who drink to enjoy, not to impress," he said.

Duval said the potential of the Chinese market has not been tapped yet. Average per capita consumption on the Chinese mainland is 1.2 liters a year, compared with 6 in Hong Kong and 10 in the US.

The strong surge in overseas travel by Chinese is helping slake that wine thirst.

"Travelers are people with purchasing power - they visit wineries, experience wine culture and bring it home with them," Duval said.

Contact the writer at williamhennelly@chinadailyusa.com