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Recession Putting the Squeeze on Napa Wineries

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BusinessWeek reported this morning that Napa wineries are finally starting to feel pressure from the recession. A survey conducted by Silicon Valley Bank reveals that as many as 10 wineries and vineyards in Napa will change hands between now and the end of next year. Compare this to zero deals like this in 2008 and you see why seven percent of Napa vintners surveyed don't have a great deal of faith in their finances, calling them either "very weak" or "on life support."

It seems that those of us who rely on wine as our life support have been switching to less expensive options which hurts sales of Napa's product, well-known for being the most expensive in the country. According to one source at a wine country private-equity fund even the "High-rollers are discovering that there are drinkable $20 to $40 bottles of wine." All in all, the report states most owners who have been in the business for awhile should pull through OK (after all, those $750 bottles of Screaming Eagle aren't exactly getting worse over time), but the newcomers might have trouble growing through the current rocky climate. [BusinessWeek via NYT Bay Area]

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