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Foley buys Sebastiani: an analysis


The sale of Sebastiani, which I wrote about on the Wine Enthusiast website, was surprising to read about on Saturday morning, when I was going through my Google Alerts for “wine.” It’s always a shock to discover that a venerable old winery has been sold: William Hill, Mondavi, Louis Martini, Buena Vista, Chateau Montelena (on, then off) and so on. Whenever it happens, it shakes the wine world up a little, and makes the ground we’re standing on feel a little less secure.

That’s the first reaction. On sober reflection, though, such things usually make sense in hindsight, and somehow feel inevitable. Were we really so shocked that Mondavi was acquired by Constellation? We shouldn’t have been, given all the years of difficulties (both substantiated and gossiped about) the company went through. Louis Martini? They’d struggled for years.

So now we have Sebastiani, a winery and family with which I have a long association. I reported on the famous feud between Sam and his mom, Sylvia, who fired Sam. I was at Sam and his wife, Vicki’s, new Viansa Winery the day they formally opened it, in a driving rainstorm, and Sylvia showed up to bury the hatchet — a touching, sweet moment. With my encouragement, Wine Enthusiast awarded Don Sebastiani & Sons our American Winery of the Year award, in 2005; I’d been astonished at how  effectively Don built the new company from nothing.

Four years ago, Mary Ann Sebastiani Cuneo told me how hopeful the family was about the winery’s future. They’d redesigned the product line to include 4 tiers, and Marc Sebastiani, Mary Ann’s son, predicted the new generation would be fully involved.

And now this. From the vantage of an easy chair, this Monday morning quarterback can see that the sale had to happen, and this economically challenging business climate was the obvious time to do it. Bill Foley, the wunderkind billionaire who bought Sebastiani, is on a roll, and he must have determined that the price, which I have confirmed is about $47 million, was a good one.

The Sebastianis must have felt like the game wasn’t worth the candle anymore. I don’t know what they’ll go on to, but Sam and Don have proven that they have the entrepreneurial ability in their genes to start from scratch and make it happen, and Mary Ann and her family are smart and savvy.

If you have to be bought by someone, Foley’s probably your best guy. I’ve spent time with him, both in Santa Barbara and, this past summer, at the Whitefish Mountain ski resort he owns. He’d brought me up there to conduct a few seminars for his big Wine and Food Summit. Over the years I’ve formed the impression that Foley is a very passionate, determined guy who’s dedicated to making great wine. He’s not someone who buys a winery and then drives it into the ground. I once told him he reminds me of Jess Jackson in that respect. When he buys (or starts) a winery, his entire motive is to make it better. So I think that Sebastiani the brand is only going to go up in quality. Foley retained Sebastiani’s famed Cherryblock Vineyard, and I wouldn’t be surprised if the quality of their Secola Bordeaux blend and Cherryblock Cabernet Sauvignon soar.

  1. Greed and ego make for a particularly effective, albeit gradual, solvent.

  2. Astute analysis, Steve. Here is my cheeky and non-astute analysis penned when I learned of Sebastiani sale through a tipster.

  3. I look at this as a positive for both sides . . . It’s obvious now that the Sebastiani family wanted out, and Bill Foley wants to build a ‘national’ presence with well respected labels up and down the West Coast . . . win/win.

    It will be interesting to see if the winemaker DOES stay on or if changes are made . . . and if any expansion of the line takes place to take advantage of location and varieties (does Sebastiani do much pinot?!?!?).

    Twill be fun to watch from afar . . .


  4. Larry, I’ve reviewed quite a few Sebastiani Pinot Noirs over the years. I don’t know if Foley intends to expand overall production beyond the current estimated 250,000 cases.

  5. The Martini/Mirassou model seems very workable. Sell to a conglomerate which agrees to keep the historic wine making family involved, if for no other reason than marketing. The Foley/Jackson model snuffs out the family connection.

  6. Epicuria, I’m not so sure the Sebastianis wanted to remain connected with the winery.

  7. Steve-
    I appreciate your comment that when a old family winery like Sebastiani sells it ‘makes the ground we’re standing on seem a little less secure’. In our case we could go a step further and say it is as much loneliness as it is insecurity. But both sentiments are worth resisting. 150 years after the first vines were planted here it seems the industry is in many ways as young, dynamic and as exhilarating now as it was then. There seems a never ending stream of new ‘family’ wineries here in Sonoma alone, let alone the rest of the wine world. With them you find dynamic passionate people who should inspire and challenge us all to continue make the most out of our love and access to this way of life. For any multi-generational enterprise, it is retaining the founding passion that becomes one of the most important aspects of succession. Without it, you will never have the energy or the will to keep pace with today’s pioneers, who are as hungry and ambitious now as the first generation vintners were in their day.

    The downside of a sale like this, from my perspective, is the potential change in the community and, at least spiritually speaking, the wines. All wineries are important to their communities, and well established locally owned wineries are even more so. Local owners understand first hand the impact of the jobs they create and the revenue they generate because they and their families are there to see and feel it. Protecting and preserving the natural environment from which their produce originates or preserving the lifestyle of their employees (who are also neighbors) are not just business concerns, but personal lifestyle concerns as well, and everybody in the community benefits. Less obvious is that the local communities are also a rich part of the wines that come out of them. In our family’s case we have stayed and prospered here so long as individuals and as a family because we like what we do, we like our neighbors, and we like where we live and work. That ‘human’ terroir can’t help but impact the wines we make and the pride we take in sharing them.

  8. Jeff, great reply. Thanks for the heartfelt comment.

  9. Jeff’s comment highlights the difference between the GB family situation and that of Sebastiani. The former family had single male members running the winery-Towle, Jim and then Jeff. Compare that to the Sebastiani clan with three headstrong offspring followed by numerous Gen X kids. Also worth noting is the contrast between Jeff and Jon Sebastiani’s careers, co founders with Mike Sangiacomo of WineBrats, with Jon having to contend with substance abuse problems.

    True, the conflicts among the Sebastiani family ensured, I suppose, that they couldn’t/wouldn’t follow the Martini/Mirassou/Gallo model.

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