The Duckhorn Portfolio to Be Acquired by Private Equity Firm for $1.95 Billion
Esteemed luxury wine company The Duckhorn Portfolio will be acquired by Los Angeles-based private equity firm Butterfly Equity for $1.95 billion in an all-cash transaction, according to a Monday press release.
Napa Valley’s esteemed Duckhorn Vineyards was first established in 1976, and quickly became popular for its high-end expressions of Merlot. The brand has since expanded to a full portfolio of premium brands including Decoy, Kosta Browne, Goldeneye, and more. The company also acquired Sonoma-Cutrer in November 2023, growing their presence in the white wine category with the third-largest luxury Chardonnay brand in the U.S. According to Shanken’s Impact Databank, Duckhorn is now the 20th-largest wine marketer in the U.S. by volume, selling 2.6 million cases last year.
“As a leading pure-play luxury wine producer, Duckhorn has, in our view, the best portfolio and strongest fundamentals in the industry,” Butterfly partner Vishal Patel said in the release. “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.”
The deal was unanimously approved by the Duckhorn Board of Directors. The Duckhorn Portfolio, which is currently publicly traded, will become a private company after the deal closes this winter. Under the terms of the agreement, Duckhorn stockholders will receive $11.10 per share in cash, representing a premium of about 65.3 percent. The deal also includes a customary, 45-day “go-shop” period that expires November 20. During this window, Duckhorn and its advisors will be permitted to solicit, consider, and negotiate alternative acquisition proposals from third parties.
“This announcement is excellent news for the future of our company and for stockholders of The Duckhorn Portfolio, who will receive a substantial premium,” Duckhorn president, CEO, and chairperson Deirdre Mahlan said of the acquisition in the release. “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.”
Founded in 2016, Butterfly Equity is a food-and-beverage-focused firm, with a portfolio of brands including Milk Specialties Global, Chosen Foods, and QDOBA, among others. Because of the firm’s history creating value in similar brands, Duckhorn believes that the partnership with Butterfly can help expand its wineries’ reach.
“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,” Mahlan says.
Shortly after the acquisition was announced, Duckhorn released its sales numbers for its fiscal year through July and its fourth quarter net sales. Fiscal year net sales reached $405.5 million, an increase of $2.8 million or 0.7 percent compared to the prior year. Barron’s reported Monday morning that the announcement spurred the company’s stock to soar.
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