Treasury Wine Estates has announced it will cut 175 jobs in a move to invest more heavily in marketing and promoting its brands.
The job losses come as part of efforts to reduce costs by $35 million in 2014-15, ABC Rural reports.
In April, chief executive of TWE, Michael Clarke admitted that “there is a lot that needs to be fixed” at TWE, and confirmed that the company needed to address its costs structure in order to improve shareholder value.
Clarke told analysts and media yesterday that he'll allocate the extra marketing funds to the global and international brands, rather than the commercial ones.
"We're prioritising about 20 of our 83 brands, that we're allocating the bulk of the step-up in [marketing] in," he said.
Yesterday, TWE rejected a preliminary bid for to acquire all shares in TWE at a price of $4.70 cash per share from private equity firm, Kohlberg Kravis Roberts & Co. (KKR).
Since the KKR takeover proposal was made public, shares in the wine group have jumped nearly 25 per cent to a 10-month high, the Sydney Morning Herald reports.
Earlier this month, TWE Treasury Wine Estates announced it is making a play for the estimated $360 million in revenue in impulse purchases by freshening up its ‘everyday’ Rosemount range label for the UK convenience store market. TWE hopes a better quality of labelling will give the Rosemount range a premium look, helping the brand stand out on UK convenience store shelves.