Purcari Wineries Group is a leading player in the wine and brandy segments in the Central and Eastern Europe region, with around 1,400 hectares of vineyards and four wineries located in the Republic of Moldova and Romania. The Group, which now has over 500 employees, has won dozens of prestigious awards for its wines and is expanding its presence in Germany Starting February 2018, the Group is listed on the Bucharest Stock Exchange, under the ticker WINE. Victor Bostan, a wine business veteran with over 30 years of experience, leads Purcari, a company backed by top institutional investors, including Horizon Capital, Franklin Templeton, SEB, Fiera Capital and IFC. Here, Bostan, CEO and co-owner of the company, explains Purcari’s fascinating history and his vision for its future.
Purcari can look back on a long history from 1827 to today. What has contributed to its enduring success?
There are several factors that have made Purcari successful, but one of the most important ones is the terroir. The soil, the weather and microclimate here are ideal for wine production. The vineyard was started when Catherine the Great of Russia invited Swiss and German colonists to come to Moldova. She told them that they didn’t have to buy land, but just work it and pay taxes. They inspected the region and found that this was one of the best areas to plant grapes for wine. In 1827, Emperor of Russia Nicholas I issued a special decree granting Purcari the status of the first specialized winery in Bessarabia. The wine production became famous. After that came the Soviet Period, and Purcari became property of the state. All of these infused a new development phase for the winery. During this time, they took into account what the initial owners of the land were doing. Using this knowledge, in the 1950-60s they planted everything around the Purcari area and they revived the famous wines. During the Soviet period, there were two famous wines – Negru de Purcari (Black of Purcari) and Roşu de Purcari (Red of Purcari). After the collapse of Soviet Union and when democracy started, everything was lost for the winery – the markets, the contracts, everything. The ‘90s was not a very good period for the winery.
I was a university student at the time and had a three-month practicum at Purcari. The director of the winery back then was German. During the practicum, there were several students who were also learning about the rich history of the area. We did a lot of wine tasting, even of expensive wines like old collection wines and wines that were being exported to places like the UK. This man made us fall in love with the wines and the history of the region. It was very inspiring. When I finished university, I worked for 10 year as an oenologist at a winery in Moldova while part of Soviet Union, after which in 1992 I started a few smaller wine projects, following my larger project in 1999 – Cubani Vino, which I sold in 2002. That transaction allowed me to have the finances to come back to Moldova and invest in Purcari. After buying it in 2002, we produced our first wines in 2003. Around 10 years ago, I also looked for the former German director, found him and invited him to visit the winery.
It’s really impressive how many awards Purcari wines have won since 2002. Besides the environmental conditions, how are you producing such quality wines?
Modern technology combined with classic techniques. Every step is important from grapes, to the fermentation process, from barrels to bottling. Then, human talent is hugely important. Wine is a living product. It needs to be watched and taken care of like a little child. One mistake, and you can lose it. That is why our people have to be very well trained. They come with a lot of experience from other countries like France and Spain, an exchange we emphasize and support. The agriculture team is critical, as are the specialists. Around 70 percent of the quality of wine is determined by the quality of grape. That’s why our people in agriculture are extremely well trained and precise in how they plant the grapes. These are all the ingredients that go into making a good wine. Then, the next step is marketing and sales.
Marketing is a very important ingredient; it’s what brings our wines around the world. Our team works with international agencies and consults with the internal team on a regular basis. We have a very good creative mix with our internal marketing team and external consultants. This formula has led us to success, and the wine has been well received around the world. We have become famous in the two countries where our wine is sold today.
Of course, having someone onboard like Horizon Capital, the private equity fund manager which now holds a 22.7% stake in the company, is another factor…
Yes, that’s true. They saw our operations and how well they were carried out. If we didn’t have all the ingredients, this success would have been difficult to achieve. Horizon came with the necessary financial support and got involved to help us further refine and grow our brand.
Horizon also stayed with you after the IPO as a vote of confidence. What does the expansion plan look like in terms of the Western European market and the German market especially?
In the present day, we position ourselves very strategically in Europe. We have 70% of the premium market in Moldova and 25% of the premium segment in Romania. We are also now growing our success in large markets – Germany, the UK, the US, China. In China, we’re already seeing success, being a massive market and with a lot more room to grow. At the moment, we are in a very active process of growing our presence in Germany with Purcari wines. We’ve been working more actively on this for the past six months. The German market is very interesting for us. Germany as a wine-producing country is good for white and pinot noir production, while it doesn’t have the full variety of grapes that other countries have so it does import a lot of the wines. It’s also more costly to produce wine in Germany, where it is required around five times the effort to get the same quality of wine. At the same time, Germans are very knowledgeable about wine.
What does it mean for you to build the company in both Moldova and Romania?
After 2001-2003, I was thinking about expanding outside Moldova. I visited Romania and saw opportunities. In 2002-2003, in Romania, the wine consumption was at a lower level. The wine quality was questionable and there was a modest share of premium segment. That was the opportunity I saw in the market. And then, we went to select where we wanted to buy a property and chose an area in Romania. The opinion of experts was that it was an ideal location for the white wines. The wines are aromatic and well balanced in terms of acidity. The first of our two vineyards there is about 200 to 300 meters above sea level and are right by the beginning of the Carpathians. It has good southeast exposure, so the height and inclination allow for the grapes to have complex and interesting properties. Knowing this, I bought the vineyard, refurbished it and transformed it into the most modern winery in Romania.
What is your vision for the company going forward?
Our vision is to become a champion in wine production in the Central and Eastern Europe. One venue is to focus on local grape varieties, and open them for global consumption. This is important because there are consumers who always want something original, something local. The international trend is going towards more local grapes, that is why we want to use this opportunity Three years ago, we started production of sparkling wines as well. It was the first experience in that segment. During the Soviet time, there was no sparkling wine production at Purcari. And what is fantastic, during the two years we’ve been making sparkling wines, we’ve received over 30 medals, one of our sparking wines was ranked as top 10 sparkling wines in the world. It’s extremely encouraging to achieve such amazing results in just two years. We are still experimenting and know that sparkling wines are another real trend in terms of global consumption, making this segment very important for our development. We’re making big investments in bottling and have grown very fast from a chateau to a production place for 4 million bottles a year at the Purcari winery alone, while as a group we produce 18 million bottles a year. We foresee to soon be producing 10 million bottles a year at Purcari, requiring us to adjust the site and continue to modernize to ensure the quality of our wines is maintained as we grow. The technology of wineries is continuously evolving, requiring us keep up with the latest developments. We are also in the process of acquisition and expansion in other regions. Ukraine is a wine country with excellent grapes. We are also looking at Romania for further expansion because, among other reasons, it’s part of EU, which is an important factor in our investment decisions, and around 20-30% of the project can be funded by the European Union, which obviously makes Romania very attractive from this point of view. However, Moldova and Ukraine can also access some of the EU funds. But most important on the long term is that we keep improving – both our wines and our people.
Do you have a final message for readers of Die Welt?
Every time you want to consume wine, give priority to the quality. Don’t look at the price too much. It’s better to drink a smaller quantity but at a better quality. At Purcari we have this as a mission, to bring joy in people’s lives by offering them high quality, inspiring, ethical wines and excellent value for money.