You may very well ask: Why is an insurance conglomerate buying a wine conglomerate in a deal worth a whopping $579 million?
Well, in the case of Fairfax Financial Holdings acquiring Andrew Peller Limited (the owner of Okanagan wineries Sandhill, Gray Monk, Wayne Gretzky, Black Hills, Red Rooster and Tinhorn Creek) it's all about business, money and opportunity.
"This agreement represents a compelling outcome for our shareholders, delivering immediate value and reflecting the strength of Andrew Peller's portfolio and market position," said Andrew Peller CEO Paul Dubkowski.
"Importantly, we believe Fairfax is the right long-term partner for the company. Their investment approach, financial strength and long-term orientation provide a strong foundation to continue building our business and supporting the ongoing growth of the Canadian wine industry."
Fairfax will buy all of Andrew Peller stock for $8 per class A share and $12 per class B share, representing a premium of 41% and 70% respectively based on the stock's closing price on Friday.
The deal requires approval by shareholders, which is expected to happen so the transfer in ownership can happen sometime in the fall.
Andrew Peller is the 65-year-old company that owns Okanagan wineries and brands Gray Monk, Sandhill, Tinhorn Creek, Red Rooster, Black Hills and Wayne Gretzky.
Andrew Peller also owns Ontario wineries Peller Estates, Thirty Bench and Trius, big blend wine brands Cooper Moon and Black Cellar, an import agency and 100 The Wine Shop stores inside or beside grocery stores in Ontario.
Andrew Peller was started by its late namesake 65 years ago with the first vineyards planted in the Okanagan.
However, Andrew Peller soon became based in Ontario's Niagara wine region with operations in Ontario, BC and Nova Scotia.
John Peller is the third generation leader of the company.
He was CEO until 2024 and remains the company's chairman.
While primarily an insurance company, Fairfax's investment activity means it will also become a wine venture when it takes on Peller.
It's a similar financial-company-owns-wine-
Arterra, which has Okanagan wineries Jackson-Triggs, Inniskillin, Laughing Stock, See Ya Later Ranch, Nk'Mip, Culmina, Black Sage, Sumac Ridge and Saintly, is owned by the Ontario Teachers' Pension Plan.
Arterra also has some Ontario wineries, import brands Ruffino from Italy, Kim Crawford from New Zealand and Wallaroo Trail from Australia, as well as 160 Wine Rack stores in Ontario.
