Pass the portfolio:
More bad news for the now hard pressed wine investment sector – Premier Cru Fine Wine Investments Ltd, 'Europe's Leading Fine Wine Investment House' and perhaps the longest established wine investment company (since 1995), is winding down its business and transferring its clients to Cult Wines Ltd. (See letter from Premier Cru: 31st July 2014 below).
Once again this development underlines the benefits of having your own account at a bonded warehouse with investors having control over their wine. Instead those investors, who had a portfolio with Premier Cru, now find themselves passed over to Cult Wines Ltd.
If I was a client of Premier Cru Fine Wine Investments Ltd I would be tempted to either open my own account at EHD (you will have
full control over your wine). Accounts could also be open other bonded warehouses for example at London City Bond's private accounts facility – Vinothèque – or with Octavian Vaults. Cult Wines Ltd uses London City Bond for their storage. However, as the wines are already at EHD is would make more sense to open an account there rather than transfer the wines elsewhere.
Alternatively consider companies that offer storage/portfolio management. These include Private Reserves (www.privatereservesltd.com/ - contact Laura Goedhuis or have a look at Nexus Wine established by Mark Bevan @ http://www.nexuswine.co.uk, or you could also consider Arc Reserves.
Alternatively consider companies that offer storage/portfolio management. These include Private Reserves (www.privatereservesltd.com/ - contact Laura Goedhuis or have a look at Nexus Wine established by Mark Bevan @ http://www.nexuswine.co.uk, or you could also consider Arc Reserves.
Figures based on 31st August 2013 accounts:
Net Worth - 434.6K; current liabilities: 796K
More details (hope you like red and minus signs)
https://www.duedil.com/company/06350591/cult-wines-limited/financials
Premier Cru Fine Wine Ltd: headline finances (accounts to Feb 2013)
(Most recent accounts slightly overdue)
Net worth - 101K current liabilities 197.5K
(Most recent accounts slightly overdue)
Net worth - 101K current liabilities 197.5K
A fine wine bear market since 2011 has not been good news for wine investment companies. Before deciding to go with Cult Wines Ltd I would want to take a good look at their accounts. A post-tax profit of £150,564 in the accounts to 3st August 2011 has been transformed in two years to a post-tax loss of £403,014 (31st August 2013). Premier Cru Fine Wine Investments Ltd's financial position does not look healthy either – its latest accounts are slightly overdue – they should have been filed on 31st July 2014. More bad news there?
Letter from Premier Cru directors:
31st
July 2014
Dear
The Directors of Premier Cru Ltd are sorry
to announce the wind down of the business on an orderly basis as soon as
reasonably practicable. Our reasons for
doing so are largely personal and unfortunately have been forced upon us by the
serious illness affecting Stacey which we feel has impaired our ability to
deliver the level of service that you require from an investment in this
market.
We have therefore undertaken a review of our market competitors and have concluded that Cult Wines, who are currently the UKs leading fine wine investment company as the best positioned to assume management of your portfolio and on this basis we are finalising an agreement to migrate our private clients to Cult Wines (PCI) Limited which we hope to complete by August 14th 2014.
The transfer of your account to Cult Wines is not at this time unconditional and it is possible that Cult Wines will not be in a position to assume management of your account, even if you should wish them to do so.
In any event, should you wish Cult Wines to manage your account, then that would be on the terms of an agreement between you and Cult Wines under their terms & conditions of business, a copy of which Cult Wines will provide to you, should you wish to open an account with them. A brief summary of their terms & conditions are set out below for your information.
Please note that, prior to any new agreement between you and Cult Wines, Cult Wines is not able to accept any liability or responsibility to either Premier Cru (Fine Wine Investments) Limited or its customers.
Please see below your current stock holdings in storage at EHD,the precise value of which will be confirmed to you once you have agreed to transfer your account to Cult Wines, whereupon they will carry out a full reconciliation of your final client account & stock records.
Subject to that reconciliation, below for guidance purposes at this stage is a statement of your account:
It is important to recognise that we have selected Cult Wines based on their range of market leading client services, their position in the international fine wine market and the unique range of online services which are unrivalled in this sector.
Cult Wines provide a very personal private client service, a portfolio manager will be appointed to manage your account and will provide access to their website where you can view your portfolio holdings (which are revalued daily), weekly market reports and obtain a tailored approach to maximising your investment in this market.
Portfolio Management Services:
Clients of Cult Wines will also receive a unique portfolio management service which will include the following:
We have therefore undertaken a review of our market competitors and have concluded that Cult Wines, who are currently the UKs leading fine wine investment company as the best positioned to assume management of your portfolio and on this basis we are finalising an agreement to migrate our private clients to Cult Wines (PCI) Limited which we hope to complete by August 14th 2014.
The transfer of your account to Cult Wines is not at this time unconditional and it is possible that Cult Wines will not be in a position to assume management of your account, even if you should wish them to do so.
In any event, should you wish Cult Wines to manage your account, then that would be on the terms of an agreement between you and Cult Wines under their terms & conditions of business, a copy of which Cult Wines will provide to you, should you wish to open an account with them. A brief summary of their terms & conditions are set out below for your information.
Please note that, prior to any new agreement between you and Cult Wines, Cult Wines is not able to accept any liability or responsibility to either Premier Cru (Fine Wine Investments) Limited or its customers.
Please see below your current stock holdings in storage at EHD,the precise value of which will be confirmed to you once you have agreed to transfer your account to Cult Wines, whereupon they will carry out a full reconciliation of your final client account & stock records.
Subject to that reconciliation, below for guidance purposes at this stage is a statement of your account:
It is important to recognise that we have selected Cult Wines based on their range of market leading client services, their position in the international fine wine market and the unique range of online services which are unrivalled in this sector.
Cult Wines provide a very personal private client service, a portfolio manager will be appointed to manage your account and will provide access to their website where you can view your portfolio holdings (which are revalued daily), weekly market reports and obtain a tailored approach to maximising your investment in this market.
Portfolio Management Services:
Clients of Cult Wines will also receive a unique portfolio management service which will include the following:
Cult Wines will allocate a dedicated
Portfolio Manager to each client account
Portfolio Managers are available at all
times to support client enquiries
Portfolio Managers are multilingual
including dedicated Chinese speaking staff
An online private client account with
Cult Wines
Online access to your investment
portfolio which is revalued on a daily basis
Clients can access a sold stock statement
to monitor all stock movements
Clients will receive a weekly newsletter
& market report
Clients will receive our leading edge
wine analysis on a weekly basis
Please do visit the Cult Wines website www.wineinvestment.com, which is the No 1 site for fine wine investment.
You may also wish to visit https://www.trustpilot.co.uk/review/www.wineinvestment.com to read independent reviews from existing clients relating to Cult Wines’ services.
To help us complete the transition to Cult Wines as quickly and as smoothly as possible, please confirm your agreement to the transfer of your account to Cult Wines by no later than August 14th 2014. All you need to do is reply to this notice indicating that you would be content to transfer your account to Cult Wines. If we do not receive any reply to this notice by August 14th 2014, we will assume that you do not object to this transfer.
Cult Wines have arranged for the following Terms & Conditions to be offered to all Premier Cru clients and will work to ensure all clients are kept informed during the transitional phase.
Terms & Conditions for PCI clients
Clients of Premier Cru will be offered a revised fee schedule when moving their account from Premier Cru to Cult Wines. The following terms & conditions would apply specifically to this fee schedule and be available to Premier Cru clients
Please do visit the Cult Wines website www.wineinvestment.com, which is the No 1 site for fine wine investment.
You may also wish to visit https://www.trustpilot.co.uk/review/www.wineinvestment.com to read independent reviews from existing clients relating to Cult Wines’ services.
To help us complete the transition to Cult Wines as quickly and as smoothly as possible, please confirm your agreement to the transfer of your account to Cult Wines by no later than August 14th 2014. All you need to do is reply to this notice indicating that you would be content to transfer your account to Cult Wines. If we do not receive any reply to this notice by August 14th 2014, we will assume that you do not object to this transfer.
Cult Wines have arranged for the following Terms & Conditions to be offered to all Premier Cru clients and will work to ensure all clients are kept informed during the transitional phase.
Terms & Conditions for PCI clients
Clients of Premier Cru will be offered a revised fee schedule when moving their account from Premier Cru to Cult Wines. The following terms & conditions would apply specifically to this fee schedule and be available to Premier Cru clients
The fee schedule is directly linked to the provision of portfolio management services that will offered by Cult Wines to each client. These are unique to the fine wine investment market and will ensure all clients have access to a wide range of leading edge management services.
Fee Schedule:
Cult Wines will charge a 5.0% annual management fee for years 1 & 2 effective August 14th 2014 (this includes the client set up fee). There is a liquidation charge of 5.0% on stock that is sold or moved during year 1, Cult Wines will offer a reduction to 2.5% for stock that is sold or moved during year 2
Cult Wines will also offer a reduced management fee from year 3 of 1.75% per annum which includes a 0% liquidation charge.
Fees will be payable within 30 business days of invoicing and Cult Wines would reserve the right to collect fees from the sale of client stock if unpaid after 30 calendar days. Clients would be charged £1.25 per case/month which would cover all storage & insurance charges for the term of the investment, this will be invoiced on an annual basis.
If you have any questions in connection with this notice, or wish to confirm that you are content to offer the transfer of your account to Cult Wines, please email us at premiercru@cultwinesltd.com.
Alternatively, if you have questions about Cult Wines, then please feel free to contact Philip and Tom Gearing, the Directors and founders of Cult Wines. Philip and Tom are best placed to explain their process and plans for you and your portfolio going forward.
Their full contact details are:
Cult Wines Ltd, St Andrews House, Upper Ham Road, Richmond TW10 5LA
Philip Gearing - 020 8332 9386 Director
Tom Gearing - 020 8332 9386 Director
Kindest regards
Stacey-Lea and Paula Golding
CEO and Co-Founder
I bloody told you. So much for your journalism efforts. More bad news to come about PC. Like the size of the hole is over £2mill / HK wine merchant
ReplyDeleteAnon's comment that I didn't publish at the time:
DeleteAnonymous has left a new comment on your post "As European Fine Wines goes into liquidation debts...":
Jim
I'm a HK based wine merchant (though currently on vacation with my family in Singapore).
I received a call this morning from HK telling me that a British wine investment company was on the verge of collapsing and if I was interested in buying 200 HK/China based clients.
Initially I thought it was a scam however the caller was very convincing and more than happy to meet me upon my return to HK. He was convinced that this company was close to shutting down and that these Asian based clients would need housing.
My question is is it true? Are Premier Cru Fine Wine Investments really closing or am I being taken for a fool?
Jim please advise. They seem to have been around for years which leaves me sceptical as to whether their closing is just a rumour.
Received 16th July 2014.
Anon. You did indeed! Am grateful for your comment. However, you have to appreciate that I cannot publish every comment I receive without checking. I would prefer not to be sued for libel, especially having to defend a comment that came from an anonymous source.
ReplyDeleteWould certainly welcome any details you have on the 'over £2 million hole'.
You have shown an edited version of the letter sent to the clients of premier cru, I have seen a full version that included a section stating that a stock shortfall existed due to stock being sold but not replaced, the value of this shortfall was many thousands. Has this only happened to the person I know or are all the clients receiving their letters indicating a similar shortfall. I do not know what size the client base of premier cru is but even if was only 1000 then someone in premier cru is sitting on an estimated 4 million plus, based on 1000 clients each with a shortfall of 4k. How can this be allowed to occur it cannot be legal to sell but not replace client owned stock. Even if Stacey is seriously ill, how can her morals allow such a situation to arise, I am however truly sorry to here of her ill health but has anyone at pc considered the potential illness and stress losing many thousands pounds is going to cause PC clients. Although the letter states Cult wines will provide Bordeaux 2013 wines to the current value of the shortfall, I question how they could afford to do this. Should PC clients not be seeking legal advise or contacting Trading standards or even the fraud squad.
ReplyDeleteAnon. Thank you. I published what I received, although naturally I edited out the personal details including the stock held. I would be very grateful if you could send me the 'full' or alternative version of the letter with the passage about the shortfall.
DeleteThis may be the £2 million black hole the HK merchant mentions.
Given Cult Wines Ltd's current liabilities it is reasonable to question how they can supply the shortfall from 2013 Bordeaux en primeur. More importantly if there are 09s and 10s missing then Bordeaux 13 is hardly replacing like with like.
I am (or was) an investor with PremierCru and received the letter yesterday. The version above is accurate. The letter went on to list my holdings (about £30K) including 2 'En-Primeur 2012 wines. It went on to state "Current value of stock shortfall: £543.00."
DeleteI checked with Cult wines and to paraphrase their reply I was told that unless I transferred to them then I would effectively lose the En-Primeur wines and be left with a substantial shortfall but that they would absorb the shortfall.
I am not impressed. The proposed management charge is nearly 3 times what I am currently paying and the letter states that "If we do not receive any reply to this notice by 14th August 2014, we will assume that you do not object to this transfer."
As a rank amateur in the management of fine wines I am now wondering what to do.
Thoroughly surprised they can transfer accounts like this and Cult are permitted to essentially hold the wine hostage by forcing them to pay management fees of 5% in order to get their hands on the stock. Such shady practices that give good, honest, transparent merchants a bad name by association.
ReplyDeleteAnon. I have to agree. This whole situation is thoroughly unsatisfactory with Premier Cru treating their clients very shoddily.
DeleteMy holdings of wine are only about half the value of Anon's. My shortfall is £672. One of the wines listed in my 2013 valuation is not shown in the list that accompanied the Premier Cru email. I know nothing about wine or how to trade it ...which is what I engaged PC to do for me. My inclination is to simply sell pronto, but I'm not sure how best to do this now. I have EHD "Confirmation of Stock Receipt" for four wines (including the "missing" one), leaving four unaccounted for. I am not sure of their physical whereabouts.
ReplyDeleteI am also a Premier Cru investor wishing to transfer the wine to another company but feeling trapped by Cult Wine.ncan this practice be legal? How can we check? I have stock receipts for the wine. Is that enough to prove ownership?
ReplyDeleteStock receipts may be sufficient but you need to check with the company making the arrangements to liquidate Premier Cru.
DeleteAnon. Please note my further thoughts on this:
DeleteWill the liquidator be prepared to release wines in Premier Cru client accounts to individual investors if their ownership can be clearly established. It would appear reasonable to assume that they will as the individuals' stock rotation numbers were included in the letter sent out by Premier Cru Fine Wine Investments Ltd on 31st July 2014. Furthermore Cult Wines Ltd' proposal to manage the stock held in bond by clients of Premier Cru also assumes that ownership and title of these stocks is clearly established. (from investdrinks post that includes email from Cult Wines Ltd)
My reply here assumes that Premier Cru is going into liquidation. Premier Cru clients not wishing to accept Cult Wines' proposal need to inform Premier Cru before 14th August and ask for their wines to be transferred.
DeleteDoes anyone know why Cult Wines feel they can take over management of the wine without recourse to the liquidators whereas another company can't?
ReplyDeleteI too have lost over £3000 in stock short fall. I have checked with EHD and the three cases were shipped to the far East end of May early June just before the meeting on the 25th June. To say I am furious is an understatement. We are not rich people and to think they have done this to so many is appalling despite the awful news about Stacey and she has my deepest sympathies but this does not excuse this behaviour. Having read this forum I am now even more doubtful over Cult Wines.
DeleteAnon. Thank you. Unfortunately the shortfall illustrates why it is so important to have full control over your wine. What was the meeting of 25th June please? It would also be good to have details of the three cases shipped out please? Do email me on budmac@btinternet.com if you prefer. Many thanks Jim
DeleteIt is not at all clear that Premier Cru is going into liquidation. I suggest Premier Cru clients who do not wish to accept Cult Wines's offer need to inform Premier Cru before 14th August.
DeleteAn excellent question that deserves an answer!
DeleteI would suggest that the actions of PC be reported as fraudulent. I am have been told my shortfall is over £6000 and am in the process of seeking legal advice.
ReplyDeleteAnon. Would be very interested to have details of your missing wines. Could you email me on budmac@btinternet.com please? Your name won't be mentioned in any post. Many thanks Jim
DeleteAnymore progress on whether PC's actions are illegal?
ReplyDeleteAlso, where is the wine stored anyway, surely there must be a way to do a pick up of a physical asset if they belong to you??
Anon. It is possible that the proposed agreement between Cult Wines and Premier Cru may be in breach of the new contract legislation that came into force on 13th June giving consumers increased protection. In particular the assumption if a Premier Cru client doesn't reply by 14th August it will be assumed that they have accepted Cult Wines offer.
DeleteAlthough it is your wine it is stored in the account of Premier Cru, so it only they who can give permission to release the wine at least until the agreement has been finalised with Cult Wines Ltd. If you were then able to pick up the wines you would have to pay VAT and duty due.
As a PC customer it appears that fraud has taken place. I have a cash shortfall over GBP5000 which means that PC has sold some wine in stock (which they have a right to do in managing) but that money should be in my account. Clearly that money is gone meaning PC have taken it. Like other investments the accounts held by PC should be separate from their own business accounts. My wine is not their asset so upon selling it the cash is not theirs.
ReplyDeleteI would suggest all PC investors with a shortfall to report the fraud to Action Fraud (or similar) it is a fairly quick process. The more reports submitted, the larger the scale of the issue the authorities will see as they add up amounts missing in this case. So clearly a crime has been committed if you have missing money, therefore, you have an obligation to report.
Anon. It may be fraud but it may also be largely down to mismanagement and incompetence. We still don't know enough nor the extent of the 'shortfall'.
DeleteI have been with PC since 2009 and this has come right out the blue. I have not had any correspondence from them no letter no valuation. Alarm bells started ringing when I spoke to Stacey on 1st August she said 2 directors had left to set up another company told me about her illness and said she and Paula (I think it was Paula) could not cope with the work load. I had phoned because I had asked them to sell my wine back in March they said it would take 2 to 3 months to get the best price. I left it until July and have been phoning them since then. Stacey said they had sold some of my wine over £4000 but having difficulty with 2 other wines. I had asked them to send me a cheque for what they owed my and followed it up with a letter. She never mentioned anything about the company going bust just that I would receive a letter last weekend explaining about my portfolio. But nothing has arrived yet.
ReplyDeleteIt was only doing a Google search today because I feared the company was in trouble that I discovered all this.
I phoned Cult wines and they have no record of me from PC?
What the F is going on what do I do next.
Andy M
Andy. Presumably you have correspondence that details the wines you hold at EHD, which you could produce to show Cult Wines.
DeleteLooking at Duedil none of the other directors appears to have set up a new company recently, although if the company is very recent it may not yet show up.
DeletePremier Cru Fine Wine Investments currently has two directors: Stacey and Paula Golding. Lara Jacobson resigned as a director on 3rd June 2014 – she has no current directorships. Gavin Saffer resigned as a director on 5th April 2013 and has no current directorships.
DeleteWell on the face of it it looks like good news because I am an exit customer I am on another list. Cult Wines inform me that PC are going to honour my payment for the wines they have already sold and Cult will sell the other wines on my behalf. So fingers crossed it will all work out.
DeleteI will let you know how I get on and if I get my money back.
Andy M
Andy M ,like you we are exit clients .Did you get any contact from PC when your wines were transferred to EHD, and also receive new rotation numbers for the wine ?
DeleteWe have had nothing,so noproof in writing and it seems unless we sign with Cult ,won`t be given them. would be really useful to know youe position
Andy. Thanks – hope your good news works out. Jim
ReplyDeleteHi Andy, I'm in a similar position with a £7,000 shortfall, how did you become an "exit" customer, have you had any news/luck up to now? Thanks for any info, anyone else on this forum have any ideas how to progress, Seamus
ReplyDeleteThe known shortfall looks to be steadily increasing. I think Andy became an 'exit' customer because he had asked Premier Cru to sell his wine back in March 2014.
DeleteHi Seamus, I think because I was leaving the company. I became an exit customer. I had asked PC to sell all my wines back in April. Hope that helps.
DeleteAndy M
I have now managed to shift my wine to a private account so I am not with Cult Wines. Not sure how many Premier Cru clients have done the same thing. The one remaining thing for me to sort out is that I have a case of en-primeur wine, which was listed as mine in the final letter received from Premier Cru. Doew anyone know when this is likely to be bottled and what I should do about making sure I get the case? Thanks
ReplyDeleteAnon. That's good news. What vintage is your case of en primeur please?
ReplyDeleteIt is 2012 Lafite Rothschild, Jim.
DeleteThe earliest the 2012s will be shipped is the end of this year but more likely in the first half of 2015. Depends upon the shipping arrangements the individual importers make. I don't know if Premier Cru bought direct from the Bordeaux merchants or bought through UK importers.
DeleteI have just read about this in yesterday's Mail on Sunday. I have been a customer for well over 10 years and have a substantial sum invested. I have received nothing at all maybe because I moved house and retired. This will be a real crisis as I was banking on using this money. I will contact the solicitor mentioned but I think as a group we shouls see what action can be taken.
ReplyDeleteI have now set up an account directly with EHD for the remainder of the wine. Does anyone have a copy of the Discretionary Management form which I foolishly signed but did not keep a copy of. Many thanks if anyone can help.
ReplyDeleteI have looked on www.bis.gov.uk/insolvency and PC are not listed.
ReplyDeleteI have mailed EHC about setting up a private account. How did the "poster" above do that please? Did they have to go through Cult Wines and was there any charge. Advice greatly appreciated.
No sign yet that Premier Cru is going into liquidation. I believe the legal situation remains unclear and that the wine at EHD is still in the control of Premier Cru. The difficulty is contacting Premier Cru.
DeleteI asked EHD to put my wine into a private account - with Cult Wine's knowledge - and EHD have confirmed that this has now been done, though I only have an email as evidence. EHD will charge a minimum of six nonths' storage.
DeleteI'm sure you can assume that this has been done if you have confirmation from EHD. Unfortunately in these situations bonded warehouses get caught in the middle and get involved in a lot of extra work for little or no reward. A minimum of six moths storage looks like a good deal to me.
DeleteRather looks like a change of tune from Cult Wines Ltd. Earlier En Primeur customers, who didn't want to go with Cult Wines Ltd and their 5% management fee, were informed in Cult's email that they would either have to accept Cult's offer or wait for a decision from a liquidator.
Yes I have confirmation from EHD. I understand they have lost quite a lot of momeny as a result of recent events.
DeleteThis is on the PC website "The wine belongs to you at all times, and can only be removed from bond with yours and the company's signature or that of a beneficiary in the event of death." If any has been removed ie: to HK that is clear breach of contract.
ReplyDeleteUnfortunately wine in a customer reserve account under a company umbrella account can be moved by the company alone. A very strong argument for having your own private account so you have full control over your wine.
DeleteI have a copy of the Discretionary Management Form, how do you want to contact me?
ReplyDelete