Brown-Forman Corp. has agreed to sell Fetzer Vineyards to Chilean wine producer Viña Concha y Toro S.A. for $238 million.

Brown-Forman acquired Fetzer in 1992 from the Fetzer family. At the time of acquisition, the Fetzer company was selling nearly two million cases annually. Under Brown-Forman’s stewardship, Fetzer’s depletions grew to more than three million cases in calendar year 2010. Founded in 1968, Fetzer has been recognized consistently as a leader in varietal wine development, sustainable agriculture, and as an environmental leader.

Included in this sale of Fetzer Vineyards are the Fetzer winery, bottling facility, and vineyards, as well as the Fetzer brand and other Hopland, California-based wines, including Bonterra, Little Black Dress, Jekel, Five Rivers, Bel Arbor, Coldwater Creek, and Sanctuary. Also included in the sale is a facility in Paso Robles, California. The fiscal 2010 net sales contribution from these assets was $156 million, including excise taxes. The key facilities are located in Hopland, California and employ approximately 240 people. The sale does not include the super-premium Sonoma-Cutrer brand or the company’s long-term agency relationship with Korbel California Champagnes.

In December, Brown-Forman announced it was exploring strategic alternatives for the Hopland, California-based wine assets, including a possible sale. During this process, the company considered a range of alternatives but ultimately concluded that selling the business was in the best interest of Brown-Forman shareholders.

“Brown-Forman and our partners have done a great job with these brands over the years, but as our company has grown globally and our portfolio strategy has evolved, we concluded that our company and our shareholders are best served by redirecting our resources to those opportunities around the world which offer stronger growth and higher returns on invested capital,” said Brown-Forman Chief Executive Officer Paul Varga. “This will also enable us to more fully focus on our best growth prospects in our most important market, the United States.”

The sale of Fetzer Vineyards is expected to close in April 2011 and projected to increase fiscal 2011 earnings per share in the range of $0.20 - $0.30. This transaction is subject to regulatory clearance in the U.S. and customary closing conditions. The company plans to discuss this transaction further during its fiscal 2011, third quarter earnings call on March 8, 2011.

Founded in 1883, Viña Concha y Toro S.A. is Latin America’s leading producer and occupies an outstanding position among the world’s most important wine companies, currently exporting to 135 countries worldwide. Uniquely, it owns around 9,500 hectares of prime vineyards, which allows the company to secure the highest quality grapes for its wine production. Concha y Toro’s portfolio includes a wide range of successful brands at every price point, from the top of the range Don Melchor and Almaviva to the flagship brand Casillero del Diablo and innovative stand-alone brands such as Palo Alto and Maycas del Limarí.

For more information on Brown-Forman, please visit http://www.brown-forman.com/.