Abrau-Durso celebrates its anniversary by acquiring Yubileynaya winery

Abrau-Durso Group, which celebrates its 150th birthday this year, has announced the acquisition of Yubileynaya vineyard and winemaking assets in the Krasnodar Territory. After the acquisition, the total area of Abrau-Durso Group's vinelands will increase to 6.5 thousand hectares, of which 3.3 thousand hectares are fruit-bearing vineyards.

Following the new Law "On viticulture and winemaking in the Russian Federation", Abrau-Durso Group, the leading Russian sparkling wine manufacturer, decided to manufacture all its product ranges from Russian grapes. To achieve this goal, it was necessary to increase the area of its own fruit-bearing vineyards so that the company’s demand for grapes can be fully satisfied with Russian products. The acquisition of Yubileynaya vineyard and winemaking assets was a logical and an important step that opens new opportunities for the Group's further growth. After the acquisition, the total area of Abrau-Durso Group's vinelands will increase to 6.5 thousand hectares, of which 3.3 thousand hectares are fruit-bearing vineyards. 

Yubileynaya vineyards are located between the Sea of Azov and the Black Sea, in the very heart of the Taman Peninsula. The climate and the soils in this area are appropriate for growing the best European sorts: Cabernet Sauvignon, Merlot, Cabernet-Franc, Chardonnay, Muscat, Pinot-Gris, Aligote as well as Russian selected grapes Rubin Golodrigi, Dostoyniy and Viorica. 

Yubileynaya has been facing financial difficulties since 2018. The company file for bankruptcy a year ago and put its assets for sale. After the adoption of the Law «On viticulture and winemaking in the Russian Federation», which sets forth new requirements to Russian winemakers, Abrau-Durso decided to acquire Yubileynaya. So, the transaction was of mutual benefit. After the acquisition, Abrau-Durso will own more than 3 thousand hectares of Yubileynaya's vinelands, about 2 thousand hectares of which are fruit-bearing vineyards. The Group will also purchase wine stock from the previous years and this year's harvest. 

Negotiations about Yubileynaya's acquisition started in early 2020. The parties quickly came to an agreement; however, since the bankruptcy procedure had already started, the process required some additional steps, including debt settlement. Currently, the facility has fully recovered from bankruptcy and resumed normal operations. 

The wine stock received together with the purchased facilities will be used for the manufacturing of certain categories of Abrau-Durso sparkling and still wines. The harvested grapes will be processed by the Yubileynaya winery, then the material will be sent to Abrau-Durso facilities for aging and bottling. Currently, Yubileynaya has everything necessary to perform the primary processing of up to 40 million litres a year. Its storage capacity exceeds 40 million litres. Its bottling capacity totals more than 25 million bottles of still and sparkling wines a year. 

In future, Yubilenyaya will need a technical upgrade. Abrau-Durso Group plans to invest the necessary amount which is currently being assessed by experts. The total amount of wine material, including that from Yubileynaya, will already cover 80% of Abrau-Durso's needs this year. In the next five years, in accordance with its vineyards’ development strategy, Abrau-Durso Group will entirely switch to self-supply of grapes. For now, the missing amount will be purchased from other Russian enterprises. 

"Abrau-Durso celebrates its 150th anniversary in 2020. It is remarkable that we will become the owners of such a big estate as Yubileynaya this year. This investment is very significant. We invest in Abrau-Durso and in the Russian winemaking in general.  We consider this transaction to be very successful: we acquire manufacturing facilities that have all the parameters that we need, and that is also located so close to us, in the Krasnodar Territory», says Pavel Titov, President of Abrau-Durso Group.