Corks are popping at Oeneo, the company behind Diam closures, as another Champagne house, G.H.Mumm, joins the growing number of producers in the region moving away from natural cork. With an estimated one in six Champagne bottles now sealed with the technical closure, the French-owned company has come a long way since setting up as a natural cork producer at the end of the Spanish Civil War.
It all started when Modest Sabaté, a Spanish journalist, left his Catalan homeland in 1939 after Ferdinand Franco came to power. In his book "To Cork or Not to Cork," George Taber explains that having settled in France, Sabaté founded a cork company. He had heard that Champagne producers “were desperate to obtain a reliable supply of cork now that war and dictatorships had settled over the Iberian Peninsula.”
In 1960, Modest was joined by his eldest son, Augustin, and his three brothers, and the family business grew to become one of France’s leading cork producers. With growing concern about cork taint, the family patented a new cleaning process for cork and in 1995 they launched a hybrid part-natural, part-artificial cork named Altec. It was a huge success. By 2001, Sabaté had sold 2.5 billion Altec corks and half the company had been floated on the stock market during the dot.com boom.
The same year, however, the company's foundations were rocked by a public relations nightmare. Sabaté had promised that its Altec corks were free of the cork taint caused by a number of compounds, including 2,4,6-trichloroanisole or TCA. These taint compounds are produced by fungi naturally present in cork, or which have grown on the cork during its processing.
Despite Sabaté's claims, a growing number of disgruntled wineries were complaining that they were experiencing taint issues with Altec corks. A Wine Spectator report uncovered the problems and an international media circus ensued. In 2002, Modest’s grandson, Marc, stepped down from the company, ending the family's involvement with Sabaté.
Renamed Oeneo, the firm today is largely owned by Andromède, the holding group of the Cognac and spirits producer Rémy Martin. Other shareholders include an asset management firm, Amiral Gestion, and the financial services company Crédit Suisse.
With Altec corks tarnished by the scandal, Oeneo looked towards a new and improved closure. In 2004, it launched a TCA-free technical cork – Diamant – a project the Sabaté family had initiated in 1997. It is made from cork bark, but the firm uses a process which eradicates TCA. Even gas chromatography machines, which identify TCA at two parts per trillion – a level far more sensitive than the human nose – cannot find any trace of the compound after treatment.
Called the "supercritical" process, this revolutionary method is also used to decaffeinate coffee and to dry-clean contaminated military clothing. Oeneo uses the process to rid corks of all traceable levels of TCA and other undesirable compounds that can make wines seem less fresh than they ought to be.
The cork granules are cleaned using carbon dioxide (CO2) that is compressed to the point where it has the properties of both a gas and a liquid. This is the supercritical state in which the CO2 extracts the TCA-causing molecules from the granules. Two hours and 35,000 kilograms of CO2 later, 500kg of clean granules are ready to be baked into corks. Unlike natural cork granules, they have no smell. The granules are formed into corks with a binding agent – microspheres – which fill any gaps between them. The lowest grade of Diam has larger granules and more microspheres, which result in a faster rate of oxygen transmission and more rapid development in bottle. While unwelcome for fine wines, this faster aging is acceptable for wines that are expected to be drunk more quickly.
The wine world clearly likes these stoppers. Between 2008 and 2011, Diam production increased to one billion stoppers, and in the last three years Oeneo has spent 20 million euros ($26m) improving and expanding its production facilities.
“We have doubled the capacity of the factory, which is now at 1.3 billion corks per year, and we are thinking about more investment," says Bruno di Saizieu, vice president sales and marketing for Diam. "We know we will be at full capacity in the next 18 to 24 months.”
Di Saizieu puts the cost of this expansion at 40 to 50 million euros ($51–$64m), funded by shareholders. The Diam closures are replacing an improved version of the Altec corks, now renamed "Reference." By treating with steam, the Reference corks promise an 80 percent reduction in TCA, but there's no guarantee that it has been totally eradicated.
“We do have some markets that are not sensitive to TCA who use the Reference, like the beer market,” reports di Saizieu.
Oeneo estimates that three in 10 bottles of Burgundy are bottled under Diam and one in six of Champagne – a figure backed by the Comité Interprofessionnel du Vin de Champagne (CIVC). Many producers have moved towards cork alternatives not only because of cork taint, but also because Diam closures are consistent in their quality – unlike natural corks which vary. Each Diam closure comes with a guarantee, ranging from 2 to 15 years. Producers making a supermarket, drink-now sauvignon blanc might opt for the two-year guarantee, while those producing high-end reds designed for cellaring would more likely opt for 10 or 15 years.
Winemakers can also choose the permeability of each cork. “The Diam 5 has two different permeabilities," explains di Saizieu. "In Burgundy, with pinot noir, you might want a tight closure, but with American wines, producers might want something a bit more open."
The ultimate goal is to produce closures according to individual markets: “Take a sauvignon blanc that is going to Japan. The Japanese would prefer a sauvignon blanc that is more open than the French, so you will use a different cork. Our goal is to increase our offer on permeability.”
One frequently mentioned criticism of Diam is that the closures don't look like traditional corks. Despite the number of bottles spoiled by natural corks, many consumers are still wedded to the real thing, particularly for high-end red wines. But Saizieu reports that in reality, most can't tell the two apart.
“We did a trial with a very nice Bordeaux wine. It was very interesting because we gave the bottles to people who knew about wine. We told them to take the cork out, taste the wine – they thought they were there to taste the wine. When they were tasting, we asked them: 'What do you think about the cork?' They hadn't noticed any difference.”
Despite the results of this trial, the company still felt compelled to manufacture a range of corks printed with a fake growth pattern to appease traditionalists.
In the early 2000s, at the height of its success, Oeneo (then still named Sabaté) boasted revenues of 202 million euros ($261m). This figure fell to less than 163 million euros ($211m) at the end of 2004. The company's latest annual results show it has not yet fully recovered from the Altec fallout, with profits reaching just 142.5 million euros in 2010–11.
But despite the overall drop, the closure division, Diam Bouchage (the company also has a barrel division), saw growth of more than 10 percent in 2010, suggesting that wine producers are putting their trust in its closures. Di Saizieu claims there are now 100-euro ($129) bottles of wine sealed under Diam, and the news that so many producers in Champagne have adopted it means the company is once more starting to shine.
1939: Modest Sabaté establishes cork production company in Roussillon, France.
1960: Modest’s sons join the business.
1986: Sabaté acquires Spanish cork producer, Corchos de Merida. Modest dies.
1994: Company launches its first public offering on Parisian unlisted securities market.
2000: Sabaté and barrel company Diosos merge to form Sabaté Diosos.
2002: Modest’s grandson, Marc Sabaté, steps down from the company, ending the family's involvement.
2003: Sabaté Diosos changes its name to Oeneo.
2004: Launch of Diam.
Source: International Directory of Company Histories