Viña San Pedro
Viña San Pedro
Viña San Pedro (VSP) was the third largest winery in Chile, with 1998 sales of 37 billion Chilean pesos (CP). Bonifacio Correa had planted the original vines with French stock in 1865 on the farm in Molina that the family had owned since 1701. For years, VSP wines enjoyed a reputation of being one of the finest in the country, and the vineyard remained in the Correa family until 1941. New owners expanded the vineyard so that by 1994, 1,150 hectares1 were in production, making it the largest single-site vineyard in the country. It was, however, barely profitable and survived primarily by producing inexpensive wines for the domestic market.
Compaña Cervecerias Unidas
In 1994, Compaña Cervecerias Unidas S.A. (CCU), a diversified beverage company that operated primarily in Chile and Argentina, purchased a 48.4 percent share of VSP stock for CP 7.8 billion. In 1992, CCU issued 4,520,582 American depository shares (ADSs) in an international American depository receipt (ADR) listed on the NASDAQ.2 In 1996, it completed another ADR, thereby raising U.S. $155 million in additional capital. CCU shares also traded on the Chilean stock exchange. In 1998, CCU had sales of CP 280 billion and was the dominant player in the domestic beer market with a 91 percent market share. (See Exhibit 1 for CCU financial statements, Exhibit 2 for exchange rate information, and Exhibit 3 for inflation rates.) (see Exhibit 1, see Exhibit 2, see Exhibit 3) It was also the second largest beer seller in the Argentine beer market; the second largest Chilean soft-drink producer; the largest Chilean mineral water producer; and, with the acquisition of VSP, the third largest producer of wine in Chile. The management of CCU recognized VSP as a diamond in the rough. CCU had been established in 1902 following the merger of two existing brewers. By 1916, it owned and operated the largest brewing facilities in Chile. It had also expanded its operations to include the production and
Viña San Pedro (VSP) was the third largest winery in Chile, with 1998 sales of 37 billion Chilean pesos (CP). Bonifacio Correa had planted the original vines with French stock in 1865 on the farm in Molina that the family had owned since 1701. For years, VSP wines enjoyed a reputation of being one of the finest in the country, and the vineyard remained in the Correa family until 1941. New owners expanded the vineyard so that by 1994, 1,150 hectares1 were in production, making it the largest single-site vineyard in the country. It was, however, barely profitable and survived primarily by producing inexpensive wines for the domestic market.
Compaña Cervecerias Unidas
In 1994, Compaña Cervecerias Unidas S.A. (CCU), a diversified beverage company that operated primarily in Chile and Argentina, purchased a 48.4 percent share of VSP stock for CP 7.8 billion. In 1992, CCU issued 4,520,582 American depository shares (ADSs) in an international American depository receipt (ADR) listed on the NASDAQ.2 In 1996, it completed another ADR, thereby raising U.S. $155 million in additional capital. CCU shares also traded on the Chilean stock exchange. In 1998, CCU had sales of CP 280 billion and was the dominant player in the domestic beer market with a 91 percent market share. (See Exhibit 1 for CCU financial statements, Exhibit 2 for exchange rate information, and Exhibit 3 for inflation rates.) (see Exhibit 1, see Exhibit 2, see Exhibit 3) It was also the second largest beer seller in the Argentine beer market; the second largest Chilean soft-drink producer; the largest Chilean mineral water producer; and, with the acquisition of VSP, the third largest producer of wine in Chile. The management of CCU recognized VSP as a diamond in the rough. CCU had been established in 1902 following the merger of two existing brewers. By 1916, it owned and operated the largest brewing facilities in Chile. It had also expanded its operations to include the production and