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Friday, 7 September, 2001, 17:20 GMT 18:20 UK
Bust has liquid assets
Working in a vineyard
Some of the wines are worth almost $4,000 a bottle
The unravelling of Silicon Valley's once-mighty empires is producing some unexpected side-effects.

On 15-16 September, liquidators in California are planning what's being billed as the biggest wine auction in history.

The wine - all 80,000 cases of it - belonged to now-defunct internet retailer

The firm burned through $200m before filing for bankruptcy in late April, and creditors hope to raise close to $10m from the sale.

The auction, which is being handled by fire-sale specialist AuctioNet, is being supported by eVineyard, the firm that took over the name after its bankruptcy.

Going for Guinness

Auctioneers are getting excited.

Chateau D'Yquem label
Chateau D'Yquem provides the highlight of the sale

"We are going into the Guinness Book of World Records," said Nuri Otus, chief executive of Realm Connect, AuctioNet's parent company.

While most of the wine is average vin de table, experts say there is at least $1m-worth of rare vintage product, including wines from Chateau Margaux, Chateau Latour and Chateau Petrus.

The highlight of the sale is two bottles of 1921 Sauternes Premier Grand Cru from Chateau D'Yquem, with a reserve price of $3,800 a bottle.

Licence worries

But setting up the sale has been fraught with complications.

United States authorities have become nervous at the idea of so much alcohol being sold off, largely to anonymous online buyers.

In order to comply with California's tough licensing laws, the auctioneers are having to offer vintners first refusal before selling to the public.

And an established wine retailer will process all the transactions, obviating the need for the vendors to obtain a liquor licence.

On the hunt

A further complication arose from confusion over exactly what assets controlled.

The sale has already been postponed once, after liquidators discovered some overlooked inventory.

They have also discovered two trailers filled with cheese and sausage that belonged to the firm.

But after months sitting out in the Napa Valley sun, they were not exactly in a fit condition for sale.

See also:

21 Jun 01 | Business
New world wins the wine war
19 Mar 01 | Business
Dot.coms under the hammer
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