Butterfly Equity Broadens Horizons with Duckhorn Acquisition

Butterfly Equity Completes Major Acquisition

Butterfly Equity, a Los Angeles-based private equity firm recognized for its expertise in the food and beverage sector, has finalized its acquisition of The Duckhorn Portfolio, North America’s prominent luxury wine producer. This transformative deal, valued at approximately $1.95 billion, underscores Butterfly’s strategic investment approach focused on excellence and innovation within the industry.

Unveiling the Deal

The all-cash transaction, with an offer of $11.10 per share, illustrates Butterfly’s commitment to enhancing its portfolio. Adam Waglay, Co-Founder and Co-CEO of Butterfly, expressed excitement about the move, stating, “We are thrilled to welcome The Duckhorn Portfolio and its talented team to the Butterfly family.” He highlighted Duckhorn's legacy of excellence in the luxury wine market and conveyed aspirations for growth through strategic initiatives.

Plans for Expansion

Following the acquisition, Butterfly aims to leverage its resources to expand The Duckhorn Portfolio’s global reach. The firm envisions both organic growth and the potential for strategic acquisitions, aligning with its history of enhancing its portfolio companies. The innovation journey begins with an intent to reach more consumers who appreciate quality, craftsmanship, and the rich heritage of wines produced by Duckhorn.

The Duckhorn Legacy

Established in 1976, The Duckhorn Portfolio is celebrated for its luxury wine offerings, operating in the heart of wine country with eleven wineries and acclaimed tasting rooms. With a well-rounded selection of wines from names like Duckhorn Vineyards, Decoy, Kosta Browne, and Migration, the company boasts a portfolio that competes globally.

A Commitment to Quality

The company’s dedication to sourcing premium grapes from its vineyards ensures a curated range of over 15 varietals, appealing to diverse palates with price points that resonate well within the market. Duckhorn’s commitment to quality will reignite new growth under Butterfly's stewardship.

Strategic Advisors in the Deal

The acquisition was facilitated with support from key advisors who played an integral role. KKR Capital Markets LLC acted as the capital markets advisor to Butterfly, while Kirkland & Ellis LLP provided legal counsel. From Duckhorn’s side, J.P. Morgan Securities LLC served as the financial advisor, complemented by legal assistance from Ropes & Gray LLP.

Future Outlook

As part of the transaction, The Duckhorn Portfolio’s common stock ceased its trading on the New York Stock Exchange, marking a new phase in its journey under Butterfly’s investment umbrella. Both companies look forward to what this partnership will yield in terms of operational growth and market presence.

Embracing New Opportunities

This acquisition reflects Butterfly’s overarching strategy of partnering with leading businesses across the food and beverage spectrum to drive value creation for its stakeholders. These endeavors align with Butterfly’s portfolio, which includes notable enterprises like QDOBA and Bolthouse Fresh Foods, distinguishing itself within the “seed-to-fork” food ecosystem.

Frequently Asked Questions

What is the significance of Butterfly's acquisition of Duckhorn?

This acquisition positions Butterfly Equity as a major player in the luxury wine industry, enhancing its investment portfolio and expanding Duckhorn's market reach.

How will Duckhorn benefit from this acquisition?

Duckhorn will gain enhanced resources and support from Butterfly Equity, aiding its long-term strategic objectives and operational scaling.

What is the history of The Duckhorn Portfolio?

The Duckhorn Portfolio was founded in 1976 and is known for producing high-quality luxury wines from various acclaimed American wineries.

Who were the advisors in the acquisition deal?

KKR Capital Markets LLC and J.P. Morgan Securities LLC were key advisors, along with respective legal counsels from Kirkland & Ellis LLP and Ropes & Gray LLP.

What is Butterfly's investment strategy?

Butterfly focuses on investing in the food sector, leveraging its expertise to drive transformation and value creation across its portfolio companies.

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