In the continuing saga of the battle for Torbreck, Dave Powell provides his perspective and how things have eventuated with Torbreck.
Not from Roennfeldt road, as you may have heard by now. It’s a pretty sad story and one I want you to hear directly from me. Rumours are already flying out there and I want to set the record straight. It’s a bit of an essay but bear with me, we have seven years of history to cover here. Here goes…
Seven years ago, on a Friday night in Atlanta, Georgia, I met US businessman Pete Kight and his wife Terry who had come to meet me as fans of Torbreck wines. Discovering that they were heading to Oz that coming Christmas with their two children, I invited them over for a BBQ if they made it to the Barossa.
Come December the Kights did indeed make it to the Valley and joined my then wife and I with my two boys for a great summers night. Over an old bottle of RunRig the conversation turned to business and I was telling Pete how I had to somehow raise the money to buy out my then fellow shareholder Jack Cowin.
Pete surprised me by offering to help, and although I needed a substantial amount of money, he said if it stacked up he would love to help me get my business back for my boys and me – I’d told him I’d always seen Torbreck as a legacy for my sons.
I could not believe my luck, I’d had no idea he was a billionaire. At the time I also remember thinking of the old saying that if it seems too good to be true it usually is, however I had my back to the wall so we proceeded with the deal.
That mistake cost me everything.
My lawyer advised me not to sign the deal that was presented to me, as there was a clause that would see me lose Torbreck if ever enforced. I told Pete my lawyer told me not to sign as it stood and needed to be amended. He responded by saying his lawyers were being over zealous and not to worry, we needed to get it done and could sort it out later. That he was only doing the deal to help me get Tobreck back for my family.
Fast forward five years and the time has come as per the contracts for me to provide Pete an exit from the business. I was given six months to execute the buyout. And this is where the problem in the contract came into play – if I could not complete the deal in time my option would expire and he would own Torbreck. Despite my many protestations during the five years, that problem clause never was amended. One could take the view that that was intentional…
The deadline was the 27th of July this year and I was close to getting one of many suitors to sign up. At this stage I believed I only needed another couple of months to get the deal done – time I believed in good faith that I had. I’d also spent $250,000 and become deeper in debt to Pete trying to get the deal done, and was financially very vulnerable. There may have been significance in that.
So imagine my surprise when working in Sydney, I was told Pete was at Torbreck. I was summoned home to attend a meeting with him and Torbreck Chairman Colin Ryan.
When Pete invested in Torbreck I had taken on several million dollars of the debt personally, including the 1.14 million Colin had made out of the original deal with Jack Cowin. In my naivety I did not understand the significance of this. I was about to find out.
I walked in, sat down with Pete and Colin. No pleasantries were exchanged before Pete told me that my time was up, his shares in Torbreck were no longer for sale, and the company now belonged to him.
I was told that I was no longer employed by Torbreck directly, but could have my own company working for Torbreck as a consultant roaming the world selling wine on commission, and that that commission would be directed back to Torbreck to resolve the debt I had taken on in signing the deal. If I didn’t take the ‘job’ on offer, my debt would be called in and I’d be bankrupt.
I asked about my equity in Torbreck and was told that, as per the deal I’d signed, my equity was gone. I turned to Colin, who I’ve said publicly was like a father to me, and asked, ‘What about all the times we spoke about changing that clause?’ He just shrugged. I have to say that was one of the greatest betrayals of my life.
20 years of my life, all the backbreaking work of the early days bringing those beautiful old vineyards back to life. All the heart and soul poured into my wines, each with their own special character and story. Two decades of literal sweat, blood and tears, gone. The inheritance I’d built from nothing for my sons, and the staff who’d become like family. Gone. Just like that.
I’ve seen the article in Wine Spectator Pete claiming that I haven’t been responsible for hands-on winemaking since 2006. That’s just complete bullshit. I’ve been in the Barossa alongside the troops every single harvest since I founded Torbreck in 1994, and I take full personal responsibility for the quality of every wine with a Torbreck label on it. Turns out, that was going to be a problem for me too.
You see, everyone in that meeting knew there was a serious problem with the next vintage of The Laird – the 2009. Whilst I was away doing the job of selling wine, something happened in the particular barrel store where the wine is kept. For the first time in five years the volatile acidity in the wine had gone through the roof and left unchecked. I took responsibility for it and we tried to remedy it, but it couldn’t be done. I believe the ’09 wine is unsaleable at the high price we command for it.
I’ve always maintained that I have no problems selling wines for high prices and that my benchmark is would I purchase the wine myself. In this case the answer was no. Pretty easy to offer me a job selling wine on commission when The Laird is unsaleable, and The Laird is the difference between Torbreck being profitable or not.
To conclude the meeting I was ordered to take a month’s leave and think about the new role I was to play. I was also told not to come on company property other than my house, or talk to the other members of staff, who’d been told not to talk to me. Neither man shook my hand as I left the room.
The next day my company credit cards were revoked and the following day my company email was blocked. I found out all the other employees were told that Pete had bought me out of the company, in the presence of Colin and the company CFO David Adams. I was astounded that even though they both knew the truth, they remained silent.
I felt like I was cornered so I packed up my belongings from the house I had called home for 14 years and moved to a friends’ vacant house on the banks of the Para River which they are letting me have rent free. I had to leave my company car and another mate lent me a vehicle. You certainly find out who your friends are at times like these.
Then I removed all my stuff from the office and Cellar Door. I have been accused by the new management of pilfering my own property, including the painting you see on all the Torbreck labels which was painted by my own mother.
I’ve always tried immensely hard to be good to my team, and many of them have become dear personal friends. In the Wine Spectator article this week, it was stated that my management style was ‘volatile’. I’m particularly hurt by that because I treat my team like family, always have. I hope the new bosses can say the same. Pete’s company took over our sales in the US some time ago. I still keenly remember writing a sizeable cheque from my own pocket for one of our salespeople who’d been let go a week before Christmas, after seven years, with no severance pay. Bankrupt as I am likely to be, I won’t be able to do that this time around if anything should happen to my Torbreck people and it breaks my heart to think of it.
The day after I lost everything I received a letter from Colin. It contained my “resignation” which I was expected to sign. As per my employment contract, signing that letter would have left me with no severance pay and completely penniless. That battle is ongoing, but luckily one of Australia’s top employment lawyers is a big fan of my wines and is helping out free of charge. I’m incredibly grateful to him and the many friends who’ve rallied round me at this dark time.
The hardest thing in all of this mess has been telling my two sons their inheritance is gone. My eldest, Callum, is in France at the moment working for my great friends Erin and Jean Louis Chave. He expressed maturity beyond his 19 years by telling me, “Fuck that rich bastard, don’t worry Dad, when I get home we will start something up together!”
So it has been great ride, if turbulent at times. Many of you will be thinking what an idiot to trust someone that much. I agree! I have been accused of playing the victim, of being dishonest, of being reckless with company money. If I’m a victim it’s of my own stupidity in signing that deal in the first place and I’m the first to admit it. The rest though, I strenuously deny. Money can buy a lot of silence but in the end the truth will always out.
As I sit here looking out over the river in the Valley I love so much, I’m determined that this will not be the last you have heard from me. Give me a few years and my son and I will have many great wines for you to enjoy, from some very surprising vineyard sources.
Thank you sincerely for all for your support over the years. I am grateful first and foremost for the friends around the world I’ve made as I built Torbreck from nothing. They can take the company I built but they can’t take my passion. Torbreck’s just a label now – the future holds better things.