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October 24, 2007

A veteran wine maker who bears watching

By Holly Hubbard Preston
Friday, October 19, 2007

OAKVILLE, California: 'The life of a vintner is probably the most personally life-consuming of all businesses that I know of," said Agustin Huneeus, settling into an upholstered armchair in the high-ceilinged living room of his Napa Valley home. "Your person has to be out there."

That may go a long way to explaining why after nearly five decades, Huneeus, 73, is still in the game. The Chilean native has turned around troubled wineries in Chile (Concha y Toro) and California (Franciscan Vineyards, now owned by Constellation Brands) and restructured the multibillion-dollar wine division of Seagram.

Today, he and his wife of 44 years, Valeria, a viticulturist with a doctoral degree in biochemistry, own Huneeus Vintners, which owns the well-regarded Veramonte vineyards in Chile and Quintessa Estate in the Napa Valley.

The couple and their son, Agustin Francisco, actively manage both wineries, dividing their time between Chile and Napa. Veramonte, a winery created in 1990 with its flagship label Primus, pushed Chile's Casablanca Valley into the limelight, while Quintessa, a blend of Cabernet Sauvignon and Merlot, has secured a place among the Napa Valley's top estate wines.

Those who know wine, and Huneeus's career, say that his moves bear watching. Huneeus is a "quiet kind of planner," said Karen MacNeil, author of "Wine Bible" and an authority on all things grape. "He combines phenomenal business acumen with an almost intuitive sense of where the wine industry is headed."

"Agustin Huneeus is one of the most successful entrepreneurs in the wine business," said Chris Fehrnstrom, president of Icon Estates in Napa, formerly known as Franciscan Estates until it was purchased by Icon's parent, Constellation. His "intuition and intellectual curiosity results in his ability to 'see' opportunities where others don't."

The son of a Chilean fishing industry magnate, Huneeus entered the wine business in 1960 at the age of 23 by purchasing a majority stake in Concha y Toro, which was founded by one of his ancestors in 1883. The move was intended as a short-term investment: Huneeus, as acting managing director, planned to liquidate the winery and hold onto its land. But the more he studied the winery, the more excited he became by its export prospects throughout the Americas.

Over the next 11 years, Huneeus transformed the winery from a jug wine producer into an export label, complete with foil-sealed corks and European-style glass bottles.

When Huneeus gave up the winery in 1971, it was not for profit but politics: Salvador Allende, a Socialist, had been elected president of Chile. Huneeus handed the winery over to the state and left for a job in Argentina working for Seagram, taking his young family with him.

"At that time, we thought maybe socialism was a way to give these people a better life," he said.

Seagram quickly tapped Huneeus to lead its global wine division, a sprawling fiefdom of 16 wineries spread across eight counties. After creating the first consolidated balance sheet for the division, he discovered it was losing money.

"It was a time when the corporate strategy among beverage companies was to buy whatever it could," he said. "The digestion part was not being done adequately."

Huneeus stayed at Seagram for six years, during which time the wine division became profitable.

Perhaps because of his dual background in private wineries and big beverage companies, Huneeus is circumspect on the subject of corporate ownership of wineries, a hot topic in world wine making centers.

"The instincts of the corporation run counter to wine industry," Huneeus said. "The corporation wants to have brands and market share and control of the distribution channel, and the wine industry does not inherently operate that way."

He believes that modern beverage corporations understand the importance of personal history and local flavor in wine making, which is why, he said, they are now making greater efforts to give autonomy to their individual wine holdings.

As for his own business, Huneeus wants his son to take over and grow it as he sees fit. His own preference, though, is clear.

"The corporate way," he said, "is not how I want to go."

Editor’s Note: For additional information contact Pam Hunter- 707-258-1699 x 15 or admin@studio-707.com
[Posted: 10/22/2007]

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