A waiter serves a glass of red wine in this illustration. REUTERS
Premier luxury winemaker Duckhorn Portfolio said on Monday it would be taken private by Butterfly Equity in an all-cash deal worth $1.95 billion.
Private equity firm Butterfly will pay Duckhorn stockholders $11.10 per share, representing a premium of about 106% to the wine maker’s last close on Friday.
Shares of Duckhorn were trading at $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.
The company’s fourth-quarter sales grew 7.3% from a year earlier but its gross profit margin declined 740 basis points to 47.8%.
J.P. Morgan Securities and KKR Capital Markets are acting as financial advisors to Duckhorn and Butterfly, respectively.
U.S. stocks closed solidly higher on Friday, as a stronger-than-expected jobs report reassured investors who had worried the economy may be slowing too rapidly.
Reporting by Anuja Bharat Mistry in Bengaluru; Editing by Krishna Chandra Eluri
