Treasury Wine Estates (ASX:TWE) has resolved its legal standoff with Republic National Distributing Company following the distributor’s abrupt exit from the California market last year.
Under the terms of the settlement, the Australian wine giant will repurchase its portfolio inventory from RNDC at original sale value, offset by a confidential settlement sum.
While the move provides a clean break, it comes at a cost: Treasury flags a net cash outflow of US$65 million related to the agreement.
Despite the significant one-time hit, the Penfolds owner delivered a silver lining for investors.
The group has revised its first-half earnings expectations upward to $236 million, nudging past the upper limit of its previous guidance.
"Although RNDC's decision to exit the Californian market had a significant impact on our performance in H1 FY26, we are pleased to have reached this resolution," said CEO Sam Fischer.
He noted that RNDC remains a "committed and high-performing partner" in other states, signaling a focus on stability over further litigation.
At the time of reporting, Treasury Wine Estates' share price was $5.52.