Yesterday’s announcement that Justin Baldwin and his wife, Deborah, sold the winery they started in 1981 has achieved national attention. It’s one of the more important California winery sales since the recession tightened its grip. The buyer of the 50,000- case-production winery, for an undisclosed price, was Fiji Water, whose billionaire owner, Stewart Resnick, also owns POM pomegranate juice.
We caught up with Justin Baldwin to hear about the sale and their future plans.
Wine Enthusiast: What will you and Deborah do now?
Justin Baldwin: We’ll stay on at the winery, and frankly, you shouldn’t see any changes in anything, except quality will hopefully go up.
WE: Why did you sell now?
JB: Improvement was a big motivator. This will be the best year we ever had, with respect to earnings and growth, and that is after last year, which was our best. But to go to the next step, it takes more money. We want to focus more on our high-end wines, like Isosceles and Justification, from the vineyard to the winery. But to tie up your money in inventory requires financial capital. This business is just Debbie and me, and I needed to be mindful of how much debt I can put into the business.
WE: It’s that old saying “to make a small fortune in the wine business, start with a large one.”
JB: Yes. So, it just made sense to look for other avenues that are available.
WE: Who introduced you to Stewart Resnick?
JB: A guy in the investment bank in San Francisco that’s done a lot of these deals. They came to us.
WE: How did they know you were thinking of selling?
JB: We’ve been approached countless times over the years by two different kinds of individuals: One type thinks, “This will be romantic! We’ll live in the country and drink wine every day,” and the more serious group of people who want to add to their portfolio.
WE: What made you ultimately go with Fiji Water?
JB: The things that appealed to us were that these guys are farmers. They’re the largest pomegranate growers in the U.S.; they have all the walnuts, pistachios, almonds. They understand agriculture—that it starts in the vineyard, and they have a long-term outlook on things. They have a demonstrated capability of building brands and great distribution with Fiji. But they had nothing on the wine side of things, so they need us to run that wine side. We didn’t just want somebody to come in and run up the numbers and denigrate the brand we’ve built over 30 years.