From water -- to wine? Fiji Water buys California winery

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Fiji Water Co., the imported bottled water firm owned by Beverly Hills entrepreneurs Lynda and Stewart Resnick, has acquired one of San Luis Obispo County’s oldest and most popular boutique wineries, Justin Vineyards & Winery.

The deal, which closed Friday, comes after Fiji and its parent company, Roll International Corp., sparked controversy by saying last month they were going to shut down Fiji Water operations in the island nation because of a large tax increase.

Fiji had planned to raise the tax it levies on the company to 15 Fijian cents a liter from one-third of a Fijian cent, according to a statement by the company. In U.S. dollars, the new tax is about 8 cents a liter. Fiji Water said in a statement that it was laying off nearly 400 Fijian employees and canceling construction projects in the country.

But then last week, the privately held company apparently changed its mind. In a statement, Fiji Water said it would reopen its bottling plant on Dec. 1 and that “we have also agreed to comply with Fiji’s new water tax law.”

On Monday, company officials declined to discuss the matter further. Company officials also declined to talk about the financial details of the winery sale.

John Cochran, president of Fiji Water, said the company had been looking to expand into other products to sell alongside its popular bottled water line carried by high-end hotels, restaurants and clubs. Justin Vineyards was started in 1981 by Justin Baldwin, a former investment banker, and his wife, Deborah. (The couple have said they will stay on with the business.)

The sale marks the eighth acquisition of a California winery this year, according to a news report and the Wine Institute, a trade group based in San Francisco. Many of these deals have come as California’s wine industry has been squeezed by falling land values, increased volume from countries including Australia, and recession-wary consumers shifting to cheaper brands.

But apparently, unlike some of its peers, “Justin has been doing quite well,” Cochran said. “They’ve just had their best year ever.… We plan to take a lot of that good momentum and push it farther.”

--P.J. Huffstutter