Private Equity Moves Into Spanish Wine

Spain’s Transformation: Sherpa Capital launches €25million equity investment in bid to transform the Spanish wine sector following acquisition of the insolvent, fraudulent company Reserva de la Tierra. Barnaby Eales reports.

Reading time: 3m 17s

Reserva de la Tierra - Sold
Reserva de la Tierra - Sold


  • Private Equity uses resources to acquire large but insolvent, multi-regional Spanish wine business
  • Investment will amount to 25m and other acquisitions, including a business in Galicia are part of the plan.
  • Top management has been changed
  • There will be moves into other beverages


Under its new name, Terra Cellars, Spanish private equity company Sherpa Capital is pumping €25 million of equity into the former Reserva de la Tierra, the insolvent company accused of one of the biggest wine frauds in modern Spanish history. (See Meininger’s ).

Meininger’s can reveal that together with new acquisitions of existing Spanish wineries including one in Galicia, North-West Spain, Sherpa Capital aims to transform the Spanish wine sector, which it says has too many small players operating to meet global demand from for quality Spanish wine.

“Our perspective is that the Spanish wine sector is very atomised with many small-scale wineries which are not professionalised at all,” said Jose Maria de Retana, Investment Director at Sherpa Capital.

Sherpa Capital wants to be able to be single suppliers of substantial volumes to supermarkets in Spain and elsewhere including Mercadona, Aldi, Lidl and Carrefour.

“Internationally, buyers and retailers are increasingly concentrating their list of suppliers. This is a difficulty for Spain as it does not have enough big players.”

“We want to create a group of wineries to meet the demands of our main clients in Spain and internationally,” he said.

“In Spain we produce about 40m hl a year, almost half of which is bulk wine sold to other countries like France and Italy where they bottle the wines and sell them as French or Italian wines. [Or, if respecting the law, as ‘Produce of the European Union’]

“Our aim is to gain margins by recapturing this bulk wine which we’ve lost to other countries,” de Retana said.

New Management

“Our strategy is to sell quality wines at competitive prices. We are not going to lower the quality of wines. The problem of [former Reserva de la Tierra] was not the price point of wines, but the mismanagement of the company,” de Retena said.

“Our clients demanded that we change the management of the company.”

“We have kept on middle-management and the facilities of the former Reserva de la Tierra, but the general manager and others directly linked to the fraud of Reserva de la Tierra are no longer in the company,” he told Meininger’s.

An interim manager has been appointed whilst the new owners seek executives to manage the business. Job losses are expected as management and production inefficiencies are reduced.


Reserva de la Terra bought in grapes and bulk wine from numerous growers and producers in several Spanish appellations and regions including Castilla la Mancha, Catalonia, Rueda and Galicia, and creating its own blends. De Retana said it would maintain this business model.

Production at Reserva de la Terra was of about 80m bottles of wines annually, with exports going to 36 countries. In 2019, before news of the fraudulent activities emerged, the company was listed in the top ten Spanish wine companies, with revenues of more than €60m, and sales that year of 40 million bottles.

De Retana said the company did not want to announce the name of the winery in Galicia ahead of this year’s harvest.

Together with new acquisitions, De Retana says Terra Cellars would increase production from the existing facilities of the former Reserva de la Tierra.

Sherpa Capital declined to disclose the price paid for Reserva de la Terra (announced in August) but exclusively said that the company had agreed to invest between €20 and €25 million in equity and a further €20 million through debt financing through traditional banks. The timescale of the investment was not disclosed.

Sherpa Capital’s investment in Reserva de la Tierra  comes after the company raised €120m of new funding in 2019 allowing it to diversify its investment strategy to focus on distressed low and mid-market companies requiring operational improvements.

Acquisition in Galicia

One such acquisition was exclusively revealed to Meininger’s today, when de Retana said that the company has acquired a vineyard in Galicia that generates €6 million in annual turnover from a production of 1 to 1.5m bottles. It declined to name the producer but said it wants to buy further vineyards in several Spanish appellations.

Despite the rise in recognition of and demand for quality Spanish wines over the past 20 years, Spain is widely viewed as lacking a sufficient number of big brands.

 “Rather than trying to create new wine brands and build new wineries, we’ve decided to buy existing Spanish wineries and relaunch their brands,” De Retana said.

“We will announce the name of the vineyard in Galicia in November,” he said.

Growth and Diversification

Sherpa Capital said it sees little growth in mature European markets in terms of traditional formats.

“We are looking at making cocktail drinks (based on white wine),” said De Retana.
He cited the success of Mimosa, the US drink made from sparkling white wine and orange juice.
He also said Sherpa Capital was entering a ‘very optimistic cycle’ adding that that in terms of growth, it was looking at new formats, and at developing non- and low-alcohol wines with a view to exporting them to new markets including Arabic and other Muslim countries in Africa and Asia. It also keeping its investment eye on the automation of facilities.

HQ remains in Tarragona

Although Sherpa Capital ins based in Madrid, De Retana said the headquarters of Terra Cellars would remain in Tarragona where the company owns a winery and a bottling plant.

“There are plenty of growth opportunities for Spanish wine”





Latest Articles