A Safra Scion Could Lose Its $200 Million Cellar

  • Jaqui Safra financed Woody Allen, sold New York’s most expensive co-op and owns the Encyclopedia Britannica.
  • But one of his biggest holdings – Spring Mountain Vineyard, valued at $204 million – could be seized.
  • The vineyard filed for bankruptcy on Thursday to prevent lender MGG Investments from taking control.

The Safra family has earned billions through its banking operations around the world. But that may not stop a private lender from snapping up a prized California vineyard owned by Jacob E. “Jaqui” Safra, a colorful investor and family member who lives in Switzerland.

safra for follow-up several funds affiliated with Kevin Griffin’s MGG investment group on Thursday in an effort to stop lenders from taking over Spring Mountain Vineyard, a major Napa Valley winemaker of award-winning Cabernet Sauvignon wines he began tinkering with in the 1990s .

The lawsuit, filed in New York state court, said MGG threatened to repossess the winery and tens of millions of dollars in inventory as early as Friday after Spring Mountain defaulted on a term loan of $185 million at the start of 2021. With accrued interest at 16%, at the end of July, the loan balance is $192 million, Safra’s lawyer, Marc Kasowitz, said in court documents.

But the property, according to Safra’s lawyers, is worth far more than the $125 million MGG has offered to pay, through loan reduction.

“When the loan is finally repaid – and, given that the loan is massively over-secured, as shown below, there is no doubt it will be – MGG will be handsomely rewarded for its investment,” Kasowitz and his partner Gavin Schryver. .

Spring Mountain, an 846-acre blend of four historic vineyards called Miravalle, Chateau Chevalier, La Perla and Alba just outside the city of St. Helena, was valued by Newmark Knight Frank at $204 million in June 2021 The Glass Fire, which burned across 67,000 acres of California Wine Country two years ago, destroyed 26% to 47% of the vines at each of the four wineries, according to Newmark’s assessment.

A view of a wine cellar, full of old barrels, at Spring Mountain Vineyard.

Atmosphere at Live In The Vineyard Day 1 at Spring Mountain Vineyard for music, food and wine on November 6, 2014 in St Helena, California.

Steve Jennings/WireImage

The vineyards are only part of Safra’s wealth. He owns the parent company of Encyclopedia Britannica and Merriam-Webster, which his lawsuit says “generates substantial free cash flow” and is worth at least $500 million. He said MGG held a lien on the company and boutique investment bank William Blair & Co. was buying its stake.

Safra also had a financial interest in several films. He was credited as a producer on numerous Woody Allen films, and had small roles in a few of them, before the two men fell out in the early 2000s.

The 2018 loan document, which was filed as an exhibit to Safra’s action, lists a hotel in the Swiss canton of Vaud as collateral. And last year the New York Times reported that Safra and its partner, producer Jean Doumanian, sold their 14-room Fifth Avenue co-op for the record price of $60 million to an anonymous buyer.

Safra argued the winery is likely worth even more now than when Newmark appraised it, citing the nearby Joseph Phelps vineyard which sold for $725 million earlier this year. He said MGG intended to “flip” the properties for far more than the $125 million it would credit him.

But Safra is not a “helpless and docile borrower”, wrote MGG’s lawyers at Proskauer Rose. They defaulted and negotiated two separate forbearance agreements, but still failed to pay what they owed, MGG argued. Late Thursday, Judge Robert Reed declined to intervene, saying he “lacks authority” to resolve the dispute.

“Plaintiff seeks to restrain Defendants from exercising their rights…with respect to a California vineyard,” he wrote. “This court has no authority to grant such restraint.”

Shortly after Judge Reed’s decision, Spring Mountain Vineyard Inc. filed for Chapter 11 bankruptcy Thursday in California, listing between $100 million and $500 million in assets and liabilities. Filing for bankruptcy leads to a freezing of litigation.

MGG, attorneys for MGG and attorneys for Safra did not respond to requests for comment or declined to comment on Friday.


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