The Duckhorn Portfolio, which is North America’s premier luxury wine company, and Butterfly Equity (a Los Angeles-based private equity firm specializing in the food and beverage sector) announced that they have entered into a definitive agreement, pursuant to which Duckhorn will be acquired by private equity funds managed by Butterfly in an all-cash transaction that values the company at approximately $1.95 billion.
Under the terms of the deal, Duckhorn stockholders will receive $11.10 per share in cash, representing a premium of approximately 65.3% to the volume-weighted average share price of Duckhorn’s common stock over the 90-day trading period ending on October 4, 2024. After the deal’s completion, Duckhorn will become a privately held company.
Duckhorn opened in 1976, and it is known as a leading pure-play luxury wine producer in the US with a portfolio of premium brands, including Duckhorn Vineyards, Decoy, Sonoma-Cutrer, and Kosta Browne. And Duckhorn wines are available to luxury consumers on five continents and in over 50 countries. Following the deal’s completion, the company will continue to be based in St. Helena, California, and will operate eleven winery brands under The Duckhorn Portfolio name.
Launched in 2016, Butterfly is a leading private equity firm dedicated to investing in the “seed-to-fork” food ecosystem in North America with a diverse portfolio including Milk Specialties Global, Chosen Foods, MaryRuth Organics, Orgain, Bolthouse Fresh Foods and QDOBA, and others. And with its sector experience, a disciplined and data-driven investment process, and an operations-driven approach to value creation, Butterfly looks to partner with category-leading food and beverage businesses and deliver consistent investment returns for its investors.
The deal, unanimously approved by the Duckhorn Board of Directors, is expected to close this winter, subject to customary closing conditions, including approval by Duckhorn stockholders and the receipt of regulatory approvals. The completion of the deal is not subject to a financing condition.
Upon completion of the transaction, Duckhorn’s common stock will cease to trade and no longer be listed on the New York Stock Exchange.
J.P. Morgan Securities is acting as Duckhorn’s financial advisor, and Ropes & Gray LLP is acting as Duckhorn’s legal counsel. KKR Capital Markets is acting as Butterfly’s capital markets advisor, and Kirkland & Ellis LLP is acting as its legal counsel.
The Farm Credit System, led by American AgCredit, Compeer Financial, Farm Credit Services of America, and Farm Credit Mid-America, is providing committed debt financing in connection with the deal.
KEY QUOTES:
“This announcement is excellent news for the future of our Company and for stockholders of The Duckhorn Portfolio, who will receive a substantial premium. Based on our long history of success and innovation, and our position as one of America’s most successful luxury wine companies, Butterfly believes strongly in The Duckhorn Portfolio and is fully invested in helping us achieve our next phase of growth. Just as important, Butterfly brings a proven track record of strengthening its portfolio companies while helping them advance their long-term strategic objectives. Through our partnership with Butterfly, we expect The Duckhorn Portfolio will have enhanced resources to build on our strong foundation and to further scale our operations. We are excited to work with the Butterfly team to begin writing an exciting new chapter in the story of The Duckhorn Portfolio.”
-Deirdre Mahlan, Duckhorn President, Chief Executive Officer and Chairperson
“We are honored to partner with Duckhorn and welcome the Company to the Butterfly family. This is an incredible opportunity, and we look forward to bringing our specialized expertise and deep food and beverage network to bear to help amplify and accelerate the Company’s mission to have their wine poured wherever fine wines are served throughout North America and the world.”
-Adam Waglay, Co-Founder and Co-CEO of Butterfly
“As a leading pure-play luxury wine producer, Duckhorn has, in our view, the best portfolio and strongest fundamentals in the industry. We believe the Company’s curated suite of luxury wine brands, structurally advantaged business model, and world-class team have laid the foundation for a powerful, scalable platform, which will continue to drive growth both organically and through strategic acquisitions.”
-Vishal Patel, Partner, Butterfly
