Wine magnate Bill Foley is buying a stake in a wine distribution company, a move that gives him more control over where his wines are sold.
Foley is purchasing a minority interest in Epic Wines, a Capitola-based wholesaler that imports and distributes wines in California. The deal is scheduled to close Sept. 1.
“I just felt like we needed ... more influence in where our wines are sold,” Foley said Monday. “Now I can sell through a distributor that I'm a partner in.”
Epic will distribute about 150,000 cases of Foley's wines, he said. Last year, Foley's group of wineries sold 1.15 million cases worldwide.
Part of Foley's portfolio will stay with Young's Market, a major distributor that sells his wine in California, Hawaii, Alaska and other western states.
Epic also distributes wines from Cecchetti Wine Co., Michel-Schlumberger and Schug Carneros Estate Winery, among others.
The investment will help Foley's smaller wines stand out in a sea of competitors that grows every day, said Jon Fredrikson, president of Gomberg, Fredrikson & Associates, a Woodside wine industry consulting firm.
“That model has been used very successfully starting with Jess Jackson a couple of decades ago,” Fredrikson said. “And others that have their own distributors, like Bronco, really have a tremendous advantage. So it makes sense ... if you're a part owner of a distributor it's a good way to make sure the smaller brands get attention.”
As an investor in Epic, Foley also will become a part-owner in Butterfield Station, a brand that sells about 80,000 cases per year.
Epic was a good fit because founder Robert Prough was interested in transporting some of the ownership, Foley said. It also was small enough that Foley could afford it.
“It was the right size for me,” Foley said. “Not too small. It's an experiment. We'll see how it goes.”
Foley, who had amassed a collection of 16 wine brands by the start of this year, downplayed his future acquisition plans.
“I'm out of money,” Foley said with a laugh. “I'm broke.”