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The Wine Collective Completes Acquisition of The Wine Society Assets

By Thursday 24 September 2020No Comments

Wine Collective Holdings Pty Ltd trading as The Wine Collective (TWC), one of Australia’s fastest-growing online wine businesses, has completed the acquisition of the residual assets of The Australian Wine Consumers’ Co-Operative Society Limited, which traded as The Wine Society (The Society).

The Society, established in 1947 as Australia’s first wine club, was placed into administration by its directors on 28 July.

The day-to-day operations of The Society had previously been outsourced to TWC since 2016, when The Society first came close to collapse. At that time, TWC purchased all stock and inventory from The Society and engaged all its employees, with a contract to manage wine sales to The Society’s members.

Following the administrator’s appointment in July, TWC has negotiated the purchase of the remaining assets of The Society, comprising the membership database, intellectual property, licences and residual business assets.

The shares held by The Society in TWC have been purchased by TWC’s own shareholders pursuant to pre-emptive rights they hold.

The Society’s name (The Wine Society) and trademarks have also been transferred.

“TWC’s acquisition of these assets is a favourable outcome for The Society members, who will continue to enjoy its exceptional customer offering,” TWC CEO Lloyd Heinrich says.

“Benefits include a significantly improved range of both Australian and international wines, leading customer service and delivery, and the seamless transition to a modern and user-friendly digital platform while respecting The Society’s 74 years of history.

“As part of the acquisition of the membership database, The Society’s current members will be incorporated into TWC and will continue to receive ongoing special offers and loyalty status.

The Wine Collective is a synergistic union of five wine retailers, now fully integrated into a single consumer-centric business. These brands include The Wine Society, Cracka Wines, My Wine Guy, Winegrowers Direct and From The Producer.

When TWC took on the support function for The Society four years ago, its members had approximately 300 wines to choose from. Today, TWC boasts more than 7,000 local and international wines for sale, vastly improving depth of choice for a modern and diverse customer base.

Active customers have increased by 29 percent year-on-year and new customers make up 30 percent of monthly purchases.

“Significant investment in new technology has driven this considerable growth, delivering Australia’s best wine marketplace that offers members unrivalled choice, expert advice and impeccable service at their fingertips,” Mr Heinrich says.

Pendulum Capital Pty Ltd acted as corporate advisor to TWC in relation to the acquisition.

Since its launch in 2016, Wine Collective Holdings Pty Ltd has been pursuing a strategy of brand consolidation and digital transformation. In its first year, the company brokered a deal to provide outsourced services to Australia’s oldest wine club, The Wine Society. The following year saw TWC purchase pioneering digital marketplace From The Producer followed in 2018 by the acquisition of Australia’s first pure play digital wine business, Cracka Wines.

Since then, TWC has been following an aggressive digital growth strategy.

Mr Heinrich believes that the future of the industry will be heavily driven by digital commerce.

“Making it crucial that Australia has a credible, independent digital marketplace to showcase the thousands of wines that are simply not accessible through traditional channels,” he says.

In FY20, TWC grew revenue more than 120 percent and continues to see strong growth as the business builds out more advanced digital assets to support the rapid evolution of online consumer buying behaviours.

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