CATCH A FALLING STAR....

A giant who was used to having his own way had, over most of his adult years, consumed as much as he could get his hands on to become big and strong. The bigger and stronger he became allowed him to walk over people who, out of either awe or fear would bow to him saying, “you are strong and masterful giant. We love you” The giant, feeling well pleased by his engorgement and inflated by the adulation set off further afield to plunder and consume. With more eating his appetite increased so that he wanted to consume bigger things. All the things he wanted to consume were not easily for the taking and the giant had to trade his possessions and valuables for them. He didn’t mind this as he believed that as he got bigger he would acquire more possessions and valuables from the little people who adored him. One day, far from home he bought one of the biggest and juiciest meals he had ever seen. It cost him most of his valuables but he was happy. When he sat down to eat it however he found that it was too large to ingest at one sitting . He chewed and swallowed, chewed and swallowed but,  after consuming large chunks he found that his body, either unused to such large amounts or tired of being stretched so much would rebel and purge out the extra and unwanted sustenance. The more he ate the more he purged. The more he purged the smaller and weaker he became. As he became smaller and weaker the little people learned not to fear him as much and, as he was becoming saggy, to not be in awe of him so much.

OK, this is a fairy story I created but there are companies today that could be the greedy giant. I'm sure that everyone who is interested in the phenomenal growth of wine companies (and their falls) over the last couple of decades will recognise something of the above. The woes of Fosters springs to mind with their overambitious purchase of Wolf Blass and Penfolds (Adelaide Steamship Company/ Rosemount etc. conglomeration of companies) and subsequent hundreds of millions of dollars write-downs, loss of brand equity, closure of wineries and subsequent job losses. Closer to home in New Zealand we witnessed the rush of blood to the heads of Lion Nathan leaders who purchased Wither Hills and other wine companies at outrageous prices before writing millions off the balance sheets (to balance their books they just might have scored the deal of the century in picking up Lindauer and other brands from Pernod Ricard at a bargain price). The most recent fiasco and the one most fitting the greedy giant is Constellation, the enormous American wine company, second only to Gallo in USA and, previously touting themselves as number one wine company around the world due to their acquisitions who have just this Christmas dumped most of their Australian acquisitions, all of their South African acquisitions and half of their UK acquisitions at a fraction of the price that they paid for them progressively over the last few years. We are talking of hundreds of millions of dollars here. More importantly we are talking about the loss of brand image and integrity of some brands that are many decades old and trusted by wine drinkers. Much more importantly is the loss of jobs. Greedy giants may well have been popular heroes in the 1920's, the 1980's and inexplicably the early 2000's but I think that with experience (bad) their time is up. Come in number one (or is that two?).