Endeavour to sell Oakridge, gut Chapel Hill, as part of drastic profitability-boosting restructure

On Wednesday, Endeavour Group (EDG) announced it was selling most of its winery and vineyard assets as part of a $300 million cost-saving strategy led by newly appointed managing director and CEO Jayne Hrdlicka.

Described by the company as a “strategic transformation” of its Pinnacle Drinks business and premium wine portfolio, the restructure aims to boost profitability across its retail network, including Dan Murphy’s and BWS stores, by focusing on “brands and regions that generate the strongest returns” and “exiting or selling non-core winery and agricultural assets”.

Among the assets considered “non-core” are award-winning Yarra Valley winery Oakridge and Tasmanian winery Josef Chromy. While EDG will seek a buyer for the former, the future of the latter, which is owned by asset manager Warakirri, is less clear, with Endeavour announcing only that they won’t be renewing the lease. 

The historic Chapel Hill cellar door will close in June.

The Chapel Hill, Riddoch and Krondorf brands will be retained, although their vineyards and other physical assets, including the Chapel Hill cellar door, will be sold. This aligns with the company's announcement of an 80 per cent reduction in its own grape production "resulting in 99 per cent flexible sourcing of purchased bulk wine and grapes".  

EDG will also close the Vinpac packaging facility in McLaren Vale, although Angaston will remain operational.

Cape Mentelle, Isabel Estate and Dorrien Estate are the only three wineries in the portfolio deemed strategically important enough to be retained in full.  

"These decisions reflect a clear choice to refocus Pinnacle on its primary role – serving our retail businesses and the customers that drive growth," said Jayne. "By concentrating on the brands and assets that customers value most, we are building a more focused private label portfolio."