News: TWE UPDATE 1-Australia's Treasury Wine to divest its commercial brand division

(Updates throughout with details and background on divestment)

Aug 6 (Reuters) - Treasury Wine Estates (TWE) , Australia's biggest wine producer, said on Tuesday it plans to divest its commercial brand portfolio and flagged a non-cash impairment charge in relation to its premium brands business.

Last year, the company had highlighted tough market conditions and a challenging consumption outlook for its commercial-grade wine, especially in Australia and the UK, as high inflation affected budget-conscious consumers.

The company has a presence in three price segments — luxury (more than A$30 per bottle), premium (between A$10and A$30) and commercial (below A$10).

Its commercial brands include Wolf Blass, Yellowglen, Lindeman's and Blossom Hill, while the priority premium brands house Wynn's, Pepperjack, Squealing Pig and 19 Crimes.

Treasury Wine declined to comment on a query seeking details on the divestment.

The company said it has been assessing the future operating model for its global portfolio of premium brands and decided to sell its commercial division as a part of the review.

Its fiscal 2024 results would include an impairment charge of A$290 million ($188.65 million) after tax, but expects to post nearly a 13% rise in underlying earnings for the period.

($1 = 1.5373 Australian dollars)