1855: yet another injection of capital

Château Latour: despite frequent injections of capital – en primeurs still not delivered

Yesterday  1855 announced that it had increased its capital base with another 5 million euros injected into the company. This appears to be at least the third injection of capital into 1855 this year and follows on from the 11.2 million euros put in last year.

The announcement from 1855: 

1855 annonce aujourd'hui avoir réalisé une augmentation de capital de 5 millions d'euros pour accompagner le développement de ses trois marques. Cette augmentation de capital a été souscrite par les actionnaires de référence de 1855 : Aphrodite (la holding des fondateurs de 1855) et les principaux actionnaires institutionnels de la société.

L'augmentation de capital a été réalisée par placement privé de 83 333 333 actions nouvelles au prix de 0.06 euros par action (prime d'émission comprise). Les fonds propres de la société sont mécaniquement renforcés et augmentés de 5 millions d'euros.

A l'issue de cette augmentation de capital, Aphrodite, la holding des fondateurs, détient toujours 51 % du capital de la société.

"Cette augmentation de capital va nous permettre d'accompagner le développement des trois marques du groupe : 1855, Cave Privée et ChateauOnline" déclare Emeric Sauty de Chalon, Président.

"D'abord, en investissant fortement dans la qualité de service : nos priorités sont de réduire les délais de livraison (et notamment des Bordeaux Primeurs), d'augmenter la disponibilité des produits et d'améliorer encore nos systèmes d'information".

We have to wait to see if this latest injection of capital improves 1855's dire record over the delivery of its clients' Bordeaux en primeurs. With over 20 million outstanding from the company's 2010 report, much will depend upon what payments 1855 has already paid to merchants to secure the en primeur wines ordered by their customers.  

The investors' section of the 1855 site makes this claim: 'Building the world's leading brand in the sale of wines'. 1855 is certainly a long way from achieving this aim but may explain why Jean-Pierre Meyers and the other shareholders continue to be prepared to bankroll 1855 in the hope that one day it will have a dominant position in the same way that Amazon does today after some early problems. However, it is certainly taking time for 1855, founded in 1995, to show any sign of dominating this market, despite the recent acquisition of Cave Privée and Chateauonline. It would be surprising if the shareholders didn't wonder whether they should do more than continue to shore up the company – perhaps a change of management would assist?    

Upper Loire wanderings – day three: Saint-Amand-Montrond – Villemontais

10 August 2009

We had a brief stop at the Abbaye de Noirlac before heading off to Châteaumeillant to meet Fabien Geoffrenet of Domaine Geoffrenet-Morval. The Abbaye does not open in summer until 10am, so as I had arranged to meet Fabien at around 10am in Châteaumeillant a visit was out of the question on this occasion.

Fabien Geoffrenet is a dentist by trade or rather he was until a passion for making his own wine forced a change of career. This must have been a decidedly brave decision as the chances of making a good living financially in dentistry must be considerably higher than in a little known VDQS like Châteaumeillant.

Fabien Geoffrenet in his Gamay vines

Driving across from Saint-Amand-Montrond the landscape was very different from the flat plains of the Berry, especially between Châteauneuf-sur-Cher and Dun-sur-Auron. Instead of the large fields without hedges, the countryside was much more rolling with small fields with hedges. Apart from the architecture you might well have imagined you were in England in Constable country.

I wanted to visit Fabien as it was these wines (Domaine Geoffrenet-Morval) that had stood out as clearly the best wines from Châteaumeillant at the tasting of Central Loire held on 18th December 2008.

Fabien started to change his life in 1997 when he began studying wine-making at the Lycée Viticole in Beaune. His studies included several stages with Bertrand Minchin of La Tour Saint-Martin (Menetou-Salon and Valençay). In 2000 Fabien and Laure set up in Châteaumeillant. Fabien had considered trying to find vines in Sancerre but this was not possible. Apparently it is very difficult for an outsider to buy vines here as any vineyards that do become available are sold between the Sancerrois. "It is impossible to break into Sancerre," said Fabien.

Some of Fabien's Gamay at the beginning of veraison

Fabien was then living at Venesmes, just south of Châteauneuf-sur-Cher. It was suggested that perhaps he should consider Châteaumeillant. Although there are 580 hectares classified as Châteaumeillant, there are actually only 82 hectares in production. This is, however, a considerable increase around 1990 when there was around 50 hectares producing. There are six producers in Châteaumeillant, who market their wines. This includes the cave co-operative which accounts for 60% of production.

"In 2000 I found 46 ares of old vine Gamay and my first vintage was selected by the Guide Hachette," Fabien explained. "I now have nearly 11 hectares – 70% Gamay, 30% Pinot Noir – and 40 ares of white – Chardonnay and Sauvignon Blanc plus 20 ares of Pinot Gris for the rosé where it is allowed to make up to 15% of the blend."

Fabien was keen to stress that, although Châteaumeillant is on the edge of the Massif Central and that its soils are formed of eroded material from the Massifs slopes, it is still a ligerian (Loire) wine region. "It is more akin to Touraine rather the semi-mountainous appellations like Saint–Pourçain, Côte Roannaise and the Côtes de Forez. Here it is never a problem to get grapes ripe unlike the semi-mountainous areas."

Previously the Domaine du Parc

I met Fabien at his tasting room in Châteaumeillant, which still has the sign of his predecessor and we soon headed out to see some of his vineyards, starting with a block of 15 year old Gamay. On the way I asked Fabien about what was happening with Châteaumeillant's application to become an appellation contrôlée. Currently it is a VDQS but this category will disappear in 2011. "The application is well advanced," replied Fabien, "Châteaumeillant should be promoted next year." Under its current VDQS rules Châteaumeillant cannot produce a 100% Pinot Noir – 40% will be maximum under the new AC rules – although it can make 100% Gamay. "We did discuss whether we should argue for a higher proportion of Pinot Noir to be allowed but a majority were reluctant to do this as it would hold up the application." As Fabien best red is the Extra Version, which has a high proportion (at least 80%) of Pinot Noir, the new rules look as though they will cause him problems.

Although I think there is much that is good about the appellation contrôlée system, it has become absurdly anally retentive in relation to the small and newer appellations the grape varieties and the proportions that can be used. What is the logic or tradition that requires Pinot Noir to be limited to 40% in Châteaumeillant? 100% Pinot Noir should be allowed here just as it should be in the Coteaux du Giennois. It seems all too likely that these restrictions have nothing to do with typicity or tradition but everything to do with powerful and established appellations not wanting upstart ACs producing pure Pinots that might highlight how poor, for example, some Burgundian reds can be. What a horror if a Pinot Noir from Châteaumeillant showed up a Nuits Saint Georges!

Natural vegetation in the centre of the row, while under the vine a mix of harrowing and weedkiller is used

"We prune long," says Fabien, "so that the vegetation is well spread out with a maximum of 10 bunches per vine, although it is more commonly eight. We use a mix of weedkiller and harrowing under the vine. The soil is very sandy and poor here, so that if the vineyard was completely grassed over it would be too much competition for the vine." Fabien is critical of the use of copper in organic viticulture. "It's a poison – not organic."

On the way to a parcel of Pinot Noir, we have a quick look at Fabien's small winery. "The first part was built in 2000 and we extended it in 2005. We pick by hand and have a sorting table. Everything is destemmed and the grapes are loaded into the vats via a conveyor belt.

More Gamay

Then we headed to the parcel called, Le Chevrier, where Fabien has his best parcel of Pinot Noir – a clone that produces small bunches. Unlike the Pinot Droit clone that produces large bunches of big grapes and is vigorous so it is difficult to control the yields. The vines are neat with the bunches well separated and well ventilated. Fabien: "The 2009 harvest will be small as the weather during the flowering wasn't good and coulure has reduced the crop. Overall it's likely the yield will be around 40 hl/ha. In 2005 we had 55/60 hl/ha, which was ideal in that good vintage."

This time: Pinot Noir (above and below)@Le Chevrier

In the lower part of the parcel, where the soil is more sandstone with a lot of iron, Fabien has his parcel of Sauvignon Blanc for his Little Big Wine vin de pays du Cher, which is a blend of Chardonnay and Sauvignon.

Sauvignon Blanc

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The imposing Château de Culan: on the road to Montluçon. The château overlooks the River Arnon, which wanders north past the vineyards of Reuilly and joins the Loire near Vierzon

Fabien had to head off for a meeting in Bourges, so he gave me samples to take away and taste later. This will be a separate post.

The previous report is now complete – more words and pics recently added.