Wine maker Duckhorn to be acquired by Butterfly Equity in US$1.95 billion deal

PREMIER luxury wine maker Duckhorn Portfolio said on Monday (Oct 7) it would be taken private by Butterfly Equity in an all-cash deal worth US$1.95 billion.

Private equity firm Butterfly will pay Duckhorn stockholders US$11.10 per share, representing a premium of about 106 per cent to the wine maker’s last close on Friday.

Shares of Duckhorn were trading at US$10.92 in premarket trading.

The transaction, which was unanimously approved by the Duckhorn board, is expected to close this winter and subject to regulatory approval.

Duckhorn’s board will have the right to terminate the agreement and enter into a better proposal from third parties during the 45-day “go-shop” period, expiring on Nov 20, the company said.

The St Helena, California-based company, was established in 1976 and has a curated portfolio of premium brands, including Duckhorn Vineyards, Decoy, Sonoma-Cutrer and Kosta Browne.

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The company’s fourth-quarter sales grew 7.3 per cent from a year earlier but its gross profit margin declined 740 basis points to 47.8 per cent.

JPMorgan Securities and KKR Capital Markets are acting as financial advisors to Duckhorn and Butterfly, respectively. REUTERS