Although I refused, Hassan’s expression did not change. He slowly set down his wineglass and spoke again.
“Would it not be better to think it over once more? If you’re worried that we might simply leave the wine sitting in a cellar, there is no need for such concern. Most of it will be distributed as gifts, so if anything, it will receive even more attention as a royal gift wine.”
Hassan waved a hand as he spoke. As he said, there were occasions when some tycoon monopolized a winery’s vintage and bought it all up. When that happened, that year’s vintage never circulated in the market, and from the winery’s perspective, it could end up losing its meaning. Hassan was pointing out that very issue.
“That is a concern as well, but it isn’t the only reason I intend to refuse.”
“Then what is the reason for your refusal?”
“It’s simple. I merely want to show our wine to the many customers who want Astra Veil. If you take as much as a third of it, the volume circulating on the market will decrease.”
“Even if we distribute it as gifts?”
“I don’t consider the title of royal gift wine to be a bad thing. However, we want our wine to be distributed properly through Redwood’s system to the VIPs who have applied for reservation purchases and to the customers of our distributors. Rather than having people unexpectedly obtain it through someone’s goodwill.”
“Oh dear... This is clearly a good opportunity... For now, rather than refusing outright, wouldn’t it be better to take some time to think? The person I serve will not be pleased to hear that Redwood rejected his goodwill.”
In other words, since the dignity of a royal figure high above was at stake, he was telling me to think it over a little more.
“In that case... very well. I’ll give it some more thought.”
“Then we will take our leave first.”
After Hassan and his party left the reception room, I sat there alone for a while.
In truth, the reasons I had given when refusing their offer to buy a third of the production at once were not mere excuses, but they were not the only reasons either. With only a third, it wasn’t as though no wine would be released into the market, and it was undeniable that there was room for the brand’s image to rise if it became a royal gift wine. No matter who heard it, it was a good offer... and that was exactly why I felt reluctant.
A truly good offer from someone I barely knew had come to me? That alone made me wary. I wasn’t in a difficult situation right now, so there was no reason to be greedier.
What made it even more suspicious was that even after I refused once, he deliberately urged me to think about it again. It definitely felt like a poisoned offer, but since I didn’t know what the poison was, it left me feeling needlessly uneasy.
I shook off those thoughts and left the reception room. When I entered the office, Warren was waiting.
“I heard a Middle Eastern royal sent someone? What for? Don’t tell me it was an offer to acquire the winery?”
“Are offers to acquire wineries common?”
As I sat down and asked, Warren opened a bottle of Sylphid—when he had brought it out, I had no idea—and poured wine into a glass.
“They’re not common, but that doesn’t mean they don’t happen. If those people are interested in something, they try to buy it, whatever it is.”
“Ah...”
“So? Was it an offer to acquire the winery?”
“No. They wanted a prior allocation of one-third of this year’s Astra Veil shipment.”
Warren’s eyes widened. Then he leisurely savored the Sylphid and said,
“A third? It’s smaller in scale than a winery acquisition, but it means they had a clear purpose. So?”
“I refused because it just felt unpleasant. A third would be a thousand cases, and if we were to pull out that much volume, we’d have to discuss it with Redwood Holdings and White Company too. It’d be a headache in all sorts of ways. And it’s not as though it would bring in some tremendous profit...”
“Heh heh... Well, if you really wanted to, you could make it work. But the unpleasant feeling is the problem, isn’t it?”
“That’s right.”
“What exactly did he say?”
“Well...”
I slowly explained what had happened in the reception room. It wasn’t a complicated story, so my explanation was over in less than five minutes.
But after hearing my story, Warren’s expression stiffened, and he said,
“You did well to refuse. Hearing this, I can’t help thinking that perhaps this may be the beginning.”
“The beginning?”
He set his wineglass down on the desk and said,
“I’ve been in the California wine industry for over thirty years. In that time, I’ve seen a few patterns of outside capital entering wineries.”
“I suppose you would have.”
“It was probably the late eighties. Japanese magnates came flooding into California. From what I heard, Tokyo real estate prices had gone mad. In any case, when people come into money, the first thing they want is to show it off, don’t they?”
“That’s true. Wine can be a symbol of wealth.”
“Exactly. It was only natural that they wanted wine. So they started by buying one case, then two, and before long there were places asking to be given priority allocations of about a hundred cases every year for company events. Then they wanted shares, and in the end, within five years, that winery... I won’t name it. In any case, that winery passed into the hands of Japanese capital. When the Japanese bubble burst in the nineties, that winery was sold to someone else, but once something slips away, it doesn’t come back.”
“Ah...”
I held the wine in my mouth and focused on his story, finding it interesting.
“There was a similar case around the late nineties too. Russia had just transitioned to a market economy, and oligarchs were getting their hands on unimaginable amounts of money. One of them entered Napa in a similar fashion. Back then, he also approached as a collector at first. A winery owner allocated a portion of the wine to him every year, and five years later, thirty percent of that winery’s shares were in his hands. Even the owner himself couldn’t explain exactly how it happened. As trust built through one small transaction after another, accepting an offer to buy shares became natural.”
It was a chilling story. If you kept giving someone preferential treatment because you thought of them as an important customer, before you knew it, they could end up occupying your inner room.
“So large transactions from one place have to be treated with caution no matter what?”
“That’s right. Do you know what they all have in common? At first, it all begins with friendship or pure interest. Very few investors come in directly saying, ‘We want to acquire your winery.’ Of course they would be refused. At first, they enter through small transactions, then increase the scale, become business partners, and eventually go as far as buying shares.”
“So they’re approaching long-term.”
“Exactly. You could say each stage takes about five to ten years. That’s exactly what came to mind after hearing the offer you received. A thousand cases, with thirty percent exclusivity every year? And for ten years at that? Dangerous. Very dangerous.”
I recalled Hassan’s face, which had seemed to show pure interest yesterday. Only now did I understand why his words—that he had come because he was purely interested in the winery—had sounded so unsettling.
“Sir, then let’s say those one thousand cases and thirty percent exclusivity are the beginning. In exactly what way does the danger come?”
Warren grinned, took another sip of Sylphid, and began speaking with a deep expression.
“Now, Master. Let’s assume you accepted that offer. You hand over the first vintage’s one thousand cases to them at the wholesale price. They said they would use it for diplomatic gifts, yes? I think the first trap is hidden there.”
“What kind of trap?”
“The people who receive that wine don’t all drink it. Some of them say, ‘I don’t drink wine,’ or ‘I need money more,’ and release it onto the gray market. The gray market is an unofficial distribution channel, not a normal wholesaler. Auction houses, unofficial wine dealers, private transactions—things like that. Imagine a bottle with a market retail price of fifteen hundred dollars appearing on the gray market for a thousand dollars.”
Before my regression, I had not been a winemaker but a scholar, so this kind of story was extremely new to me. It was a world I had not known.
“Oh, I see.”
“From a collector’s perspective, it becomes, ‘The gray market is cheaper than the normal channels.’ Then your winery’s direct sales channel wavers. Collectors stop applying directly to you and buy from the gray market instead.”
“I can see that happening.”
“After about five years of this, the marketing naturally forms that this is the wine purchased every year by the Saudi royal family. The price naturally gets pumped up. What had been a market retail price of fifteen hundred dollars jumps to three thousand, four thousand. At first, you’ll be pleased. The value of the wine is rising, after all. But what happens if one day, the Saudi royal side releases all the wine they’ve accumulated into an auction house at once?”
Seeing Warren’s sharp gaze, I flinched without realizing it.
“That would be a disaster.”
“That’s right. Thousands of bottles suddenly pour into the market, and the price collapses. Your wine instantly becomes yesterday’s wine. A cult wine built up over five years comes crashing down with a single dump. It’s a pattern called pump and dump, and you see it now and then in the American auction market.”
It was truly a vicious thing to do.
“What bastards.”
“It doesn’t end there.”
He smiled again and continued with another story.
“Once you drink the wine, an empty bottle remains.”
He pointed at the bottle of Sylphid, and without realizing it, I followed his finger and looked at the bottle.
“Empty bottles of cult wines have tremendous value in the counterfeit market. The genuine label, genuine cork, and genuine capsule all remain intact. Once the Saudi royal side drinks the wine, you can’t control where the empty bottles go.”
It was a problem I truly had never imagined.
“In theory, a thousand cases’ worth of empty bottles could come out every year.”
“That’s right. Cleaning staff could steal the empty bottles, or that side might deliberately sell them as souvenirs. If those fall into the hands of counterfeiters, fake Astra Veil will circulate in the market. What happens then? Critics will say it’s difficult to verify authenticity and lower their scores, won’t they? Even Domaine Leroy of Burgundy suffered tremendous losses because of counterfeit empty bottles.”
“Wow...”
“The Middle Eastern royal family using our wine as a diplomatic gift isn’t necessarily only beneficial either. It could be used as a political message, and that could instead come back as a negative factor.”
Then Warren’s expression, unlike before, turned completely grave, and he spoke in a low voice.
“The truth is, everything I’ve mentioned so far has been individual examples. But what if all of the things above were combined?”
Goosebumps rose on my skin.
“You lose control over the price, lose your cult status, critics’ evaluations drop... and if, at that moment, the Saudi royal side suddenly appears like a white knight? We’ve been buying your wine all this time, so as a sign of friendship, let’s work together. We’d like to buy some of your shares. In that sort of tone.”
“Ah... Then it would be hard to refuse, wouldn’t it?”
“That’s right. From your position, by then sales would have fallen and funds would be tight, so it would become difficult to refuse. Once they acquire a stake, it grows more and more over five, ten years. In the end, when you look at it one day, ownership of the winery has passed to them.”
In the end, regardless of what Hassan’s intentions were, his offer could have been hiding traps like these, laid out in several stages.
“I’m glad I refused.”
“You should say Master’s instinctive intuition is remarkable. I can see it because I have long experience, but young people are easily swayed by the profit in front of their eyes. Yet you refused it. Even if most people sense an instinctive warning, they ignore that signal.”
Warren took a sip of wine and added briefly.
“There’s one more thing you should know. Those people are persistent. They said they’d come back next Tuesday, didn’t they?”
“Yes.”
“You mustn’t meet them alone. I’ll go in with you. Ah, we should also call the lawyer, Harry Montis.”
“You don’t want to cancel the meeting altogether?”
At that, Warren opened his eyes wide as though asking what nonsense I was talking about.
“Why wouldn’t we meet such a big-spending customer?”
“You said they were dangerous.”
“They’re dangerous if you don’t know. But if you do know, there is no better customer. Guests from the Middle East spend boldly.”
Warren winked and continued savoring the Sylphid. Somehow, that Sylphid even seemed to look like Hassan.