Fancy a stake in a growing concern?

An English wine-maker that's preparing to float on Ofe

English wine has a problem of taste and image. Few people want to drink the stuff; even fewer want to be seen drinking it. In extreme cases, the enthusiasts who continue to make it resemble members of an obscure religious cult: fanatical, often bearded, and deeply mistrusted.

English wine has a problem of taste and image. Few people want to drink the stuff; even fewer want to be seen drinking it. In extreme cases, the enthusiasts who continue to make it resemble members of an obscure religious cult: fanatical, often bearded, and deeply mistrusted.

To paraphrase Dr Johnson, making wine in England is like a dog walking on his hind legs: "It is not done well, but you are surprised to find it done at all." With the enormous and varied output of wine from France, Italy and Spain, not to mention Australia, the United States, Chile, Argentina, Germany and even Mexico, why bother to make wine in a climate where the grapes don't ripen until November?

But less than 20 years ago Antipodean wine was a joke. Now Australia is the second biggest supplier of wine sold in this country. And two businessmen based on the Sussex and Kent borders are hoping similarly to rejuvenate the English wine industry.

Adrian Drewe is the chairman of Stenoak Associated Services, a £100m company listed on the AIM market. When he started running it in the late Seventies it was a small fencing company based in Uckfield, East Sussex. Now it has offices in Oxfordshire, Mansfield and Lamberhurst, Kent. His partner in the wine business, Simon Hume Kendall, is a private investor.

In February this year they acquired control of Lamberhurst vineyard from the receivers. Lamberhurst was once one of the proudest names in English wine-making, but its last owners were unable to run it profitably and it languished for 18 months. It boasts 26 acres of vines, a shop, an oast house, a pub (which also serves one of England's best regarded beers, the Sussex-brewed Harveys) and a number of houses and offices, as well as a further 25 acres of land.

Mr Drewe and Mr Kendall already own 66 per cent of Carr-Taylor, a vineyard based near Hastings, and are bidding for a 50 per cent stake in Chapel Down vineyard at Tenterden, Kent. Their plan is to switch all production to Chapel Down and specialise primarily in sparkling wine. "We produce an excellent fizzy wine, Lamberhurst Brut," says Mr Drewe. "It is already the sixth best-selling sparkling wine at Majestic Warehouses."

Mr Drewe says that he is a businessman, not a wine-maker, even though he has been making wine from a small vineyard in his walled garden for more than 20 years. He makes around 1,500 bottles of white wine a year, which he distributes to friends and family. "It probably costs me around £10 a bottle to make, after I have paid somebody to spray the vines," he says. "But it is good fun. We are planning to make considerably more wine together, as well as putting the business on a more commercial footing."

The quantity of wine produced will be subject to the vagaries of the English weather, but in a good year it is estimated that the three vineyards could produce up to 700,000 bottles. Centring all production in one area will cut costs significantly and allow for further development of the remaining sites.

Tenterden is run by a number of experienced wine-makers, including Owen Elias and Carl Koenen. They are helped by Andy Hollis, a former Oddbins employee who has worked at the Cloudy Bay vineyard in New Zealand. The commercial director is expected to be Lynette Bowen, who is a chemist by training. The partners' intention is to float English Wine plc on the unregulated Ofex market, via the brokers Peel Hunt, valuing the company at around £5m.

But will anybody buy the end product? Most of the grapes are German-style varieties: Rondo, Sayvel, Mueller-Thurgau and, the most popular, Bacchus. Tesco, Waitrose, Sainsbury's and Unwins stock the wines, as well as Majestic, so they must think there is a market for them. The wines are also available on British Airways and Virgin Atlantic flights.

Andrew Jefford, wine critic of the Evening Standard, was enthusiastic in a recent review. "Many English sparkling wines are ambitious but expensive," he writes. "Chapel Down Epoch Brut (non-vintage) combines sound value with crisp, well-balanced, russet apple flavours ... you can taste England in wine form. It's pure, poplar-slender and hedgerow-scented, a white wine of vivid, light-footed intensity, which makes lovely summer drinking. No one else in the world can do that."

However, English wine tends to be more expensive than its imported competitors. According to Mr Drewe, wine-makers in this country are at a disadvantage because of the prohibitively high taxation. Tax on sparkling wine is £1.65 per bottle and on still wine £1.16. Not only is there little tax on wine on the Continent, but enthusiastic drinkers in the south of England are getting into the habit of travelling to Calais or Bordeaux and filling their car boots.

As an investment, a stake in English Wine may prove to be one of the more exciting areas of one's portfolio, ranking perhaps with that dot-com company that has yet to set up its website, or the goldmine in Kazakhstan. The only difference is that with English Wine, if it all goes wrong you can drown your sorrows with a bottle or two of the product.