US billionaire Bill Foley takes quarter stake in Gault's restaurant empire, seeks vertical integration

Tuesday 26th November 2013

American billionaire Bill Foley has taken a quarter stake in the Nourish restaurant chain fronted by celebrity chef Simon Gault, giving him a vineyard-to-restaurant path for his wines.

Foley, though the Foley Family Wines Holdings company based at his luxury Wharekauhau lodge in the Wairarapa, has taken a 24.9 percent interest in Nourish Group which runs a chain of high-end restaurants including Euro, Fish, Shed 5, The Crab Shack, Pravda, Jervois Steak House and Bistro Lago.

Foley is following the pattern he mapped out in the US where he owns vineyards and interests in about 700 restaurants. His New Zealand holding company owns 80 percent of NZAX listed wine company Foley Family Wines Ltd and a half stake in distributor EuroVintage.

"We want to use that as a channel to sell our wine," said Mark Turnbull, chief executive of the listed wine company. "We are actually really interested in having margin from the vineyard through to the restaurant and basically part of us really looking at a vertical integration strategy."

Foley had met with the Nourish partners and was attracted to their experience, quality and longevity in the fast-moving industry. Having a stake in the restaurant group helped the company increase the profile of its wines although they wouldn't have exclusive rights, Turnbull said.

"At this stage we are basically just a partner in the business but we would like to work with them and see how we can help them grow. They sell a lot of our wine," Turnbull said. "In the future we will try and map out how we can work together."

"We think wine and food experiences are a growth area," Turnbull said. "We think there is an opportunity of creating something quite unique."

This is the first New Zealand restaurant investment for Foley outside Wharekauhau and more may be in the pipeline, Turnbull said, adding Foley is current evaluating five different investment opportunities.

Shares in the listed company last traded at $1.65 and have increased 50 percent the past year.

BusinessDesk.co.nz

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