Chapel Down, the UK’s premier winemaker, is up for sale as it aims to raise £30 million to expand its vineyards and meet the surging demand for English wines.
The London-listed company, supported by billionaire Lord Spencer, announced a strategic review on Tuesday to fund its growth plans, which include expanding its Tenterden base in Kent and constructing a new winery east of Canterbury.
A sale of the company is one of the options being explored, potentially resulting in Chapel Down delisting from the Alternative Investments Market (AIM) after just seven months. This strategic move aligns with the rising demand for English wines, driven by favourable climatic conditions turning southern England into a fertile wine-producing region.
Chapel Down’s Chief Executive, Andrew Carter, highlighted the company’s ambition to rival champagne. “There is a long pathway for us to continue to take share from champagne, and consumers increasingly understand that the wines in this country are as good if not better in terms of quality,” he said.
The French champagne houses Pommery and Taittinger have already shown interest in Britain’s burgeoning wine industry by acquiring land for wine production. Founded in 2002 and publicly listed since 2003, Chapel Down has established itself as England’s largest winemaker. Lord Spencer, a former Conservative Party treasurer and significant shareholder with a 26% stake, serves as a non-executive director on the board.
This strategic review follows a successful year for Chapel Down, which reported a 14% increase in sales to £17.9 million in 2023 and an impressive 87% rise in pre-tax profits to £2.3 million. Alongside a potential sale, the company is also considering further investment from existing shareholders.
However, the possibility of Chapel Down going private may add pressure on London’s public markets, already experiencing a wave of companies leaving the FTSE and AIM. Carter acknowledged the broader economic context, stating, “We have enjoyed a really positive listing on AIM. It’s a relatively young listing, and when we listed, we made it very clear that we were going to continue to look at optionality around different financing options. AIM and raising money on the capital markets remains a potential option and one that we’ve been actively working on in the context of this review.”
The burgeoning demand for English wines has not gone unnoticed, with sales of English sparkling wines rising by 16% in supermarkets last year, according to Nielsen data cited by Chapel Down, while champagne sales saw a 9% decline.