Washington's Ste. Michelle Wine Estates Sells For $1.2 Billion

WOODINVILLE, WA — Washington's largest wine company has been sold for around $1.2 billion dollars, according to several reports.

Altria Group, Inc., a tobacco company and the current owner of the winery, confirms it is selling Ste. Michelle Wine Estates to Sycamore Partners Management, a private equity firm. The company says it expects the deal to close sometime in the second half of the year.

The Seattle Times describes Ste. Michelle Wine Estates as "the cornerstone of Washington state’s wine industry." Ste. Michelle is based in Woodinville and claims to be the nation's third-largest wine company, farming 30,000 acres of land in Washington, Oregon and California. Its wine is sold under a number of labels, including Chateau Ste. Michelle, Columbia Crest, and Patz & Hall.

Despite being the Evergreen State's largest winery, Ste. Michelle Wine Estates sales have slipped in recent years — dropping from $691 million in 2018 to just $614 million last year, the Seattle Times reported. In 2020 the company also reported an operating loss of $360 million, per the Times.

Altaria says it intends to use money from the sale to buy back stocks, and pivot back to its primary focus on tobacco products.

“We believe the Transaction is an important step in Altria’s value creation for shareholders and allows our management team greater focus on the pursuit of our Vision to responsibly transition adult smokers to a non-combustible future,” said Billy Gifford, Altria’s Chief Executive Officer. “Ste. Michelle and its talented employees have built an outstanding portfolio of premium wine brands, and we wish them future success.”

The buyer, Sycamore Partners, is based in New York and specializes in retail and consumer investments. Its current investments include Lane Bryant, Staples, and Hot Topic, among others.

“The Ste. Michelle leadership team and I look forward to working with the team at Sycamore Partners and believe we are well-positioned to drive the next phase of our growth,” said David Dearie, Ste. Michelle’s President and Chief Executive Officer.