Party is over at Pinnacle Drinks
In May 2026, Endeavour Group's Pinnacle Drinks announced it would cut wine production by 80%, sell Oakridge and other wine assets, and retain only the Chapel Hill brand (but not the winery or vineyards).
Here's what's happening to each part of the business:
Oakridge (Yarra Valley) — the winery and vineyards will be sold
Chapel Hill (McLaren Vale) — brand retained by Pinnacle Drinks, otherwise gutted
Josef Chromy (Tasmania) — lease not renewed
Riddoch (Coonawarra) — physical assets to be sold
Krondorf (Barossa) — physical assets to be sold
Vinpac (McLaren Vale) — to be closed
Overall grape processing volume — cut by 80%
In August 2022 the Endeavour Group share price was $8.32 per share. One year ago it was $4.16 per share. Today – on the day it announced a decimation of its Pinnacle Drinks business – it’s trading at $2.94, a fall of over 27% in a year and a hell of a lot more than that since the high of August 2022.
The party is over at Pinnacle Drinks.
Pinnacle/Endeavour will now sell the Oakridge wine business – a business which makes, by any estimation, a host of Australia’s best wines. The beloved Chapel Hill brand will be retained by Pinnacle Drinks, but the vineyards and winery will be sold, and the business (devastatingly) wound up. Pinnacle’s lease on the Josef Chromy business in Tasmania won’t be renewed; the physical assets of Riddoch Coonawarra and Krondorf Barossa will be sold; and Vinpac McLaren Vale will be closed. The volume of grapes that Pinnacle Drinks processes will be reduced – I had to double-check this figure, such was my disbelief – by an incredible 80%. There will be winners and losers and silver linings as a result of all of this, as there always is, but these announcements are without question a black day for Australian wine.
Indeed, a sad day.
The gutting of the Pinnacle Drinks wine assets and production will be done at the same time, of course, as Treasury Wine Estates sets about a massive “inventory reduction” strategy, which is another way of saying that it will buy less grapes and make less wine – while it tries to figure out ways to sell the wine that it already has in stock. The market price of Treasury Wine Estates has been in its own tailspin: in February 2023 it was $14.37 per share (which was down from a high of $19.26 in August 2018); a figure that has now fallen to around $4.40 per share, having dropped $47% in the past year alone.
That’s a lot of price/valuation pressure. This price/valuation pressure is not helped – it should go without saying – by the staggering buy high/sell low strategy of winery acquisition and sale employed by both companies. Why you would buy Oakridge – a great wine producer and winery business – when the Endeavour Group did, and sell it now, during a severe dip in wine sentiment, is mind-boggling. Why you would turn Chapel Hill – an icon of McLaren Vale – into a shell, rather than investing in it, is an overt case of corporate people making corporate decisions with someone else’s money.
[Unsurprising, this strategy announcement has been “met with a cool response”.]
So Pinnacle Drinks – the most major of Australian supermarket wine players – is cutting production by 80%, and Treasury Wine Estates – the most major of Australian wine producers – is hellbent too on making less wine. You can spin the current market in whatever direction you want, but one thing is clear: Australia’s biggest commercial wine businesses are in, or have been in, freefall.
The tide of Australian wine rose for several decades; today’s announcement is a loud declaration that the tide is now well and truly on its way out. Errors – in decision making, strategy and execution – lay exposed all around.
In the glass of course, Australian wine has never been more compelling. Today though, we feel for the wreckage and for those left wrecked.
We are also left to wonder: if 80% of Pinnacle’s wine production is being scrapped, what does Endeavour Group managing director and CEO Jayne Hrdlicka mean when she says that Pinnacle Drinks will now refocus “on its primary role – serving our retail businesses and the customers that drive growth”?
There’s a lot more to Drinks than wine. And Pinnacle Drinks and the Endeavour Group have never been about anything other than creating the most financially successful model possible. No surprise or shame there. But that refocus, combined with that drop in wine production, doesn’t sound like a (supermarket) wine landscape as we have hitherto known it.
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This article was soon followed by ["You never know you're going to get boned until you do": Bicknell out at Oakridge].
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Campbell Mattinson is the founder of The Winefront business and is the former chief editor of Halliday Wine Companion. He’s published five books on wine, four of them bestsellers. He’s the only person to have won the Australian Wine Communicator of the Year Award more than once.
