A Lodi winery is at the center of two separate transactions that will put a collection of California wine brands under new ownership while bringing expanded production, canning and dealcoholization capabilities to the local facility.
The Kautz family, owners of Bear Creek Winery in Lodi and Ironstone Vineyards in Murphys, announced that it has acquired a portfolio of California wine and beverage brands from Allan Lombardi, owner of Thomas Allen Winery.
Separately, Strategic Beverage Services Inc. has acquired the Thomas Allen Vineyards and Winery production facility in Lodi and is planning a substantial expansion there, including additional alcohol-removal capacity.
The developments come as the wine industry looks for new opportunities amid declining sales of traditional alcoholic beverages and growing consumer interest in no- and low-alcohol products.
“No alcohol drinks have been a growing category in recent years,” said Stuart Spencer, executive director of the Lodi Winegrape Commission. “I’m all for if we can find alternative uses for our grapes.”
The Strategic Beverage Services acquisition took effect Aug. 3, according to CEO Pat Morgan, who spoke with Jeff Quackenbush of the The Press Democrat in Santa Rosa.
The 45-acre Lodi property includes a 60,000-square-foot winery built in 2019, a bottling line capable of handling up to 1.8 million cases annually and approximately 500,000 gallons of storage, according to Morgan.
Strategic Beverage Services plans to add a canning line with a tunnel pasteurizer, another dealcoholization plant and a bottling line capable of handling both still and sparkling wines, Morgan told The Press Democrat.
“This looks like an investment in Lodi, and any investment is a good thing. We welcome that,” Spencer said.
Kautz family expands wine portfolio
The Kautz acquisition includes Hook or Crook Cellars, Provenance Vineyards, Fortitude by Provenance, Red Phoenix, Thomas Allen Winery, Samuel Lindsay Wines, Landing 63, Weekday Wines and Weekday Water.
Quintessential, Ironstone Vineyards’ U.S. sales, marketing and distribution partner, will represent the acquired brands nationally.
“We’re excited to welcome these brands into our portfolio and build on the strong foundation already in place,” Joan Kautz, Ironstone’s global head of sales and marketing, said in the announcement.
Several of the brands have direct Lodi connections.
Hook or Crook produces Lodi wines, including Cabernet Sauvignon and its Reserve Field Blend. Thomas Allen Winery’s portfolio includes Lodi Chardonnay, Cabernet Sauvignon and red blends.
Provenance, founded in 1999, is best known for Napa Valley Cabernet Sauvignon but also produces wines from the North Coast, Monterey and Paso Robles. Fortitude by Provenance focuses on Napa Valley Cabernet Sauvignon.
The portfolio also extends beyond traditional wine. Weekday Wines are made with organically grown grapes and are marketed as having zero sugar, 80 calories and 9% alcohol by volume. Weekday Water is a canned vodka-based cocktail with 4.5% alcohol by volume.
Strategic Beverage Services expands
The Strategic Beverage Services deal gives the company a Lodi production base as it expands its work in the growing no- and low-alcohol beverage market.
The company, led by Morgan and three partners, recently completed its acquisition of BevZero’s U.S. business under a franchise agreement, Morgan told The Press Democrat.
BevZero’s Santa Rosa facility removed more than 2 million gallons of beverages last year, Morgan said. The operation uses vacuum distillation and spinning cone technology to remove alcohol and also provides services including reverse osmosis, crossflow filtration and treatment of stalled fermentations.
The market opportunity is significant.
According to NielsenIQ figures cited by The Press Democrat, nationwide sales of full-alcohol wine, beer, spirits and cider through off-premises retailers fell 3.4% last year, with wine sales down 4.9%.
Meanwhile, sales of no-alcohol beverages reached $1.01 billion, a 19.2% increase from 2024 and the first time the category surpassed $1 billion.
NielsenIQ also found that 95% of consumers who bought alcohol-free beverages also purchased alcoholic beverages.
Strategic Beverage Services is looking to expand beyond alcohol removal as well. Morgan told The Press Democrat that the company expects within several months to be able to produce alcohol at 190 proof from ethanol removed during the dealcoholization process. The higher-proof product could be used as a base for spirits such as vodka and for ready-to-drink cocktails.
Sales of spirits-based ready-to-drink beverages reached $13.6 billion last year, up 25.7% from 2024, according to NielsenIQ.
Strategic Beverage Services currently employs 24 people, with roughly half working in Sonoma County and half in Lodi, Morgan said.
The company is also considering adding another Sonoma County facility within the next year for additional co-packing, bottling and canning capacity, according to The Press Democrat.
Dining and Cooking