143-year-old McWilliam's Wines taps KPMG for administration
KPMG has revealed that it is currently seeking an injection of capital or a buyer for McWilliam’s Wines Group, after the company went into voluntary administration and brought the professional services firm on board to support with the restructuring process.
McWilliam’s Wines Group is based in Pyrmont, New South Wales, and has been making, manufacturing and distributing wine across Australia since its establishment in 1877. The company produces and markets the McWilliam’s, Mount Pleasant and Barwang wine brands internationally, while also distributing a range of brands within the Australian market.
In recent years, however, sales at the company have dwindled, making it a challenge for McWilliam’s to pay back its creditors. The company has blamed an overall shift in drinking habits for the change in fortunes, with people shifting away from alcohol or turning to alcohol-free substitutes.
Reuters reports that the raging bushfires, which are causing substantial economic damage across the country, might have something to do with the decision to enter voluntary administration, although these claims have not been confirmed by the company itself.
“We have not made the decision to enter into voluntary administration lightly. A number of factors have contributed to a decline in business performance, including evolving structural market dynamics and capital constraints,” said Jim Brayne, Chairman of McWilliam’s Wine Group.
Accounting and consulting firm KPMG has been tapped to oversee the company’s affairs during administration. The two alternatives ahead of the company are to raise capital or sell, with both avenues still on the table at present.
Gayle Dickerson, a Partner for Restructuring Services at KPMG’s Deal Advisory practice is leading the administration process. “We are seeking expressions of interest to recapitalise or acquire the group to take this heritage brand forward in the future both locally and globally,” she said.
Shifting dynamics have been affecting the wine industry across Australia in recent years, pushing many to reexamine their existing production mechanisms. The Australian government recently appointed Hydra Consulting to help improve conditions in South Australian vineyards through digitisation, which produce 80% of all premium wines across the country.
KPMG, meanwhile, is managing the administration process for a number of businesses in Australia at present, in light of tentative consumer behaviour – another factor that is affecting the wine industry. The Big Four accounting and advisory firm is currently helping online furniture company Zanui as well as fashion brand Bardot with administration.
