Vinimark splashes deeper in bubbles

It’s inevitably sad when an old family estate sees hard times and must be sold, but it looks like this particular change is at least going to be good for the brand. The Twee Jonge Gezellen estate in Tulbagh, known to be in financial trouble for many years, was sold in the latter part of 2012 to Vinimark, Tim Rands’s wine business based in Stellenbosch. Vinimark had long had a half-share in the House of Krone, TJ’s bubbly business, and now owns it all, as well as the physical property.

The Krone family are not, fortunately, lost to Tulbagh and to the wine industry, but have all been contracted to stay on in the positions they held when the property was sold. Nicky Krone, with his great experience and understanding of bubbly will consult, while sons Matthew and Luke will concentrate respectively on the cellar and brand management.

Twee Jonge Gezellen (meaning two young companions, and named for the pair of bachelors who were the farm’s founding owners) passed in 1745 into the Theron family – and since then has been handed down through the generations. Daughters were, unusually, included in the line of inheritance, so the name of the owning family changed when a Krone (son of a Dutch immigrant) married into the family in 1916.

krone_borealisGlory days included the innovative years of “N.C.” Krone after 1939, who established TJ’s reputation and was, amongst other things, a notable local pioneer of modern techniques of cold fermentation. More recently, there have been big financial problems (hugely expensive and eventually abortive litigation against Consol Glass didn’t help). The Land Bank – not inclined these days to prop up farmers indefinitely – eventually decided to foreclose, in order to recover at least a portion of what was owing to it. Tenders were invited, and Vinimark’s was the highest offer received – it was nowhere near what was owed, but the Bank gulped and took what it could get.

In fact, Vinimark’s role and investment in the House of Krone has been substantial since it bought half the brand some seven years ago, at an earlier stage of financial difficulty. The injection of cash, and concentrated effort from Vinimark’s famous distributive flair, meant that the production of sparkling wine – primarily the well-known Krone Borealis – grew hugely.

“We didn’t want to throw that investment away”, Tim Rands told me, speaking of his decision to put in an offer to buy. They could have kept just the brand, of course, “but a sparkling wine brand needs a home”, he feels.

The current production of Krone wines, however much it has grown already, is small stuff compared to what Vinimark plans to do now with their Tulbagh farm and their brand. Major investments will be made in modernising the cellar and overhauling the vineyards – including substantial new vine plantings to bring their size up from around 30 to closer to 100 hectares. Already, viticulturist Rosa Kruger has been making regular working visits to the farm, as has Vinimark’s chief winemaker, Rudiger Gretschel.

Aims in terms of production are astounding: Rands aspires to sell 600 000 bottles of Krone sparkling wines annually within three years – and a million bottles in six.

vinimark_logoVinimark does not, of course, make such projections lightly. Volumes of decent quality wines is a matter it understands very well – as testified not only by the sales of Robertson Winery wines (in which Vinimark has a 50% share), but also the remarkably increased production and sale in Boekenhoutskloof wines (of which ownership is complicated, but Tim Rands and Vinimark loom large), from Wolftrap through Porcupine Ridge, to Chocolate Block – all amongst the currently most successful and lucrative labels in the country, at their relative price points.

In fact, for many people the most interesting aspect of the Twee Jonge Gezellen/Krone deal is the fact that this is Vinimark’s first purchase of a wine-farm. What does it portend? Tim Rands is quick to stifle any suggestion that it marks the start of a new strategy for the highly successful company. Many years ago, he says, it was decided that Vinimark was a wine company that could get involved in any aspect of the wine business.

But for Vinimark, he says, “buying land at present only makes sense when it’s done to support the brand” – as was the case here. Brand Krone is on the move.

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