When Assets Become Liabilities: Managing Risk and Value in Wine Industry Transactions

Join Tony Schoenberg and MaryJo Lopez-Oneal in the discussion on "When Assets Become Liabilities: Managing Risk and Value in Wine Industry Transactions."

The wine industry is experiencing a period of contraction that is fundamentally reshaping mergers and acquisitions, as assets that were once viewed as drivers of value—such as inventory, multi-year capital investments, and locked-in grape and bulk wine contracts—may now be perceived by buyers as liabilities, creating significant gaps between seller expectations and buyer willingness to pay. To bridge these valuation gaps, parties frequently turn to flexible deal mechanisms like market price references, earn-out provisions, and other deferred-value structures, but without careful drafting, these tools can increase the risk of costly post-closing disputes.

This program will explore the risks inherent in vague or flexible contract terms, and the contractual guardrails that parties can use to reduce ambiguity, mitigate post-closing conflict, and ensure that deals are structured to succeed even in a challenging market environment.