Local Wine News

  It's been quite the couple of weeks! News from Clos Pegase Winery, Heitz Cellars, and Gundlach Bundschu Winery. The big shocker is the failure of Silicon Valley Bank.

Clos Pegase Winery, Calistoga

  The founder sold to a local wine company, Vintage Wine Estates, several years ago. VWE has expanded rapidly and apparently is short of cash. They sold off Clos Pegase's best Cabernet vineyard. The other news is the buyer, the Wonderful Company, which isn't wonderful.

Heitz Cellars, St. Helena

  The children of founder Joe Heitz sold to an out-of-state businessman. What I remember about the old Heitz, even with all their fame, managed to stay humble, low-key, and didn't even charge a tasting fee! Under new corporate direction, you have your choice of  "experiences," at $125 or $200. They did have a $1,000 option to taste in the vineyard. I no longer see this on their website, as I'm guessing there weren't a lot of takers.
  A former employee has filed a class action lawsuit for violations of labor laws. The claims are not always paying workers earned overtime, plus not giving them legally required rest breaks and lunch periods. So it appears they were trying to save money by taking it out on their lowest paid employees. The suit has just been filed, so nothing has been proven at this time.

Gundlach Bundschu, Sonoma

  A historic family run operation under the direction of Jeff Bundschu has always looked to the younger customers as their future. It's no secret that those potential buyers can no longer afford premium wine as prices, now under pressure from inflation, continue to rise.
  GB is putting together a portfolio of quality wines for under $30 that will use the GunBun name. If they can pull this off in today's market, it will be a brilliant marketing move. There are a few folks trying this in Napa, too. A couple examples are Grounded Wine and Mill Keeper. Though based in Napa, they do not use costly Napa grapes for their less expensive offerings.

Silicon Valley Bank, Santa Clara

  In a stunning development, the 16th largest bank in the country failed. The reason seems to be self-inflicted, as they sold off over $20b in bonds at a loss, causing a lack of faith and a run on the bank of people trying to get their money out.
  Most of their clients are in the tech field, with a lot of uninsured venture capital. SVB also has about 400 wine industry clients with banking locations in Sonoma and Napa Counties.
  Interestingly, the CEO sold off millions in personal stock just a couple of weeks before the collapse. SVB paid their annual bonuses just hours before the takeover. The bonuses ranged from $12,000 to $140,000. And some people don't trust banks, go figure.
  The short term effect could have been companies not able to pay bills or meet payroll. The feds have stepped in covering all depositors to prevent a panic run on other banks. The future of SVB is in doubt.