It's not just the grapes, but the wine industry itself is ripe for M&A deals this year.
Napa Valley, California-based Silver Oak this week announced its acquisition of Ovid Napa Valley, following a flurry of wineries vying to snatch up one-of-a-kind land holdings, as acreage appreciates in value and certain markets reach their full capacity of plantable space.
Modesto, California-based Gallo, for example, recently made a similar purchase of Stagecoach Vineyard, which boasted more than 600 acres of land in the Napa hillside. Following this deal, Gallo maintains its title as the world's largest family-owned wine company, competing with the likes of publicly traded Constellation Brands, The Wine Group and Bronco Wine Company.
"Even with M&A facing greater headwinds from interest rates that have trended higher, we expect [vineyard] acquisitions to remain quite active through 2017," Rob McMillan from Silicon Valley Bank wrote in his latest annual report on the wine industry.
"Large wine companies are already planning for the next wave of consumer trends by buying foreign brands, acquiring domestic wineries and brands, or buying arable property that can support a future premium brand," McMillan added.
But smaller, private players are often making deals, too, he said, though "many transactions fly under the radar in this family-run industry."
"With low interest rates favoring risk taking and with debt available, there is every reason to believe that we will see several more private equity companies put their toe in the water in 2017 and perhaps one or two close on a transaction," McMillan wrote.