Treasury Wine Estates (TWE), the owner of Penfolds, on Wednesday announced that Penfolds will likely be demerged into a separate entity on the Australian Securities Exchange (ASX) by the end of 2021.
TWE reported a net profit of 229.2 million Australian dollars (140.8 million U.S. dollars) in the first six months of financial year 2019/20.
"Penfolds accounts for approximately 10 percent of our volume, but well over half of our earnings, with unique resources and a differentiated execution focus compared to the remainder of our business," TWE chief executive Michael Clarke said in a statement to the ASX.
"A potential demerger would enhance New TWE's and Penfolds' ability to pursue their own strategic priorities and deliver a stronger long-term growth profile under separate teams and ownership structures, in addition to enabling investors to more appropriately assess the fundamental value of the brand and its assets."
Founded in South Australia (SA) in 1844, Penfolds has emerged as Australia's leading winemaker since its most famous label - Penfolds Grange - was created in the early 1950s.
In December 2019 an unidentified private collector bought a Penfolds Grange collection spanning 65 years for more than 370,000 AUD (227,333 U.S. dollars).
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