FOREIGN INVESTMENTS FOR ITALIAN WINE: EVEN IN TIMES OF CRISIS, THE DECADES LONG TREND ATTRACTS INVESTORS FROM AROUND THE WORLD. THE MOST RECENT CASE HISTORIES FROM GANCIA TO RUFFINO

If Italy could attract capital from abroad like its wineries do, there would certainly be no lack of foreign investments in the country. It is a decades long trend that has seen entrepreneurs, businessmen, international wine groups, investment funds or music and entertainment stars bring foreign funds to the vineyards of Italy. At the end of 2011, two Italian wine giants – the Tuscan Ruffino went to the American Constellation Brands and the Piedmont Gancia went to Russian Standard Corporation, and the trend continues in 2012 with Brazilian investors interested in the Cantine Ceci in Emilia.

Since the late '70s, when the Italian-American family Mariani founded Castello Banfi in Montalcino, the winery that opened up world markets with Brunello di Montalcino, many wineries, especially, but not only, in Tuscany have been the protagonists of a "capital gain" from abroad. The investors, however, have always kept Italian "know how" in production, without altering the product's strong points: identity and the territory.

In December 2011 70% of the shares of Gancia Spa, the sparkling wine from Piedmont (2.000 hectares of controlled vineyards, 5.000.000 kilos of wine grapes, 25 million bottles produced per year between sparkling, still and aperitif wines, 100 employees and annual sales of about 70 million euros) were taken over by the Russian Standard Corporation opening a channel to Eastern Europe (after the joint venture with Marchesi de 'Frescobaldi, owners of the Ornellaia Esate in Bolgheri, Castelgiocondo and Luce della Vita in Montalcino ,the Russian group Stolichnaya Vodka and the American group Robert Mondavi Corporation), even though Italian wine has always attracted mostly Anglo-American investors.

The most recent case, in order of time, is Ruffino, the famous Tuscan winery (600 hectares of land and 15 million bottles a year). In October 2011 it was totally taken over by the U.S. giant Constellation Brands, already a shareholder, which acquired a 50.1% stake for 50 million euros from the Folonari family (who remain on the board of directors). And another American, Louis Camilleri, head of the Altria Group Inc., the holding company controlling the Philip Morris group, purchased the villa & estate "The Giardinello” in Montalcino.
Continuing this excursion in foreign investment in the Italian wine world, in 2008 the Belgian Virginie Saverys (Compagnie Maritime Belgian Nv) became owners of the historic cellars of Nobile di Montepulciano of the Avignonesi Estate, investing and expanding the vineyards. Going further back in time, Porta Vertine di Gaiole in Chianti, in the Chianti Classico area has belonged to the American entrepreneurs Dan and Ellen Lugosh since 2006, which is not far from the Capannelle winery of James B. Sherwood, founder and shareholder of the Orient - Express Hotels (who owns, among others, Hotel Cipriani in Venice, Hotel Splendido in Portofino, Villa San Michele in Florence and Hotel Caruso in Ravello).

Also in Tuscany, between Chianti and Valdarno, at the Tenuta IL Palagio, Sting, ex-leader of The Police, has been producing wine since 2003. And another big international music star, Mick Hucnall, voice of Simply Red, bought vineyards in Sicily in 2002 and created his estate Il Cantante.

In 2000 Richard Parsons, former CEO of Time Warner bought the Palazzone Estate in Montalcino, while in 1995 the American businessman Frank Grace invested in twine farm Il Mulino di Grace in Chianti, between Radda in Chianti and Panzano, and in 1994 the U.S. Kendal Jackson wine group purchased Villa Arceno in the Chianti Classico area. Among the foreign-owned Italian wineries there are La Mozza in Maremma and Bastianich Vineyards in Friuli Venezia Giulia, owned by the Italian-Americans Lidia and Joseph Bastianich, among the most important restaurant owners in the United States.
These are just some of the most important cases that narrate how the appeal of Italian wine abroad not only as a product, but also as an investment, has never diminished over time, and continues to attract new interest and perhaps capital, even from emerging economies, like the case of Cantine Ceci, a leading company of Lambrusco, which have been in contact with potential investors from Brazil.