Dive Brief:
- Butterfly, a private equity firm, has announced its acquisition of the Duckhorn Portfolio luxury wine company for $1.95 billion in cash.
- After the transaction, Duckhorn will remain operational under its current name as a privately held company based in Napa Valley, California.
- Butterfly Equity has a history of acquiring food and beverage companies, including Milk Specialties Global, Bolthouse Fresh Foods, Orgain, and Qdoba restaurants.
Dive Insight:
This acquisition is part of a larger trend of consolidation in the wine industry, as sales decline due to changing consumer preferences.
Duckhorn’s CEO, Deirdre Mahlan, believes that Butterfly’s purchase will support the company’s growth strategy.
Shareholders of Duckhorn will receive a premium of $11.10 per share in cash as part of the deal.
The purchase of Duckhorn by Butterfly is expected to strengthen Duckhorn’s position as a leading luxury wine producer in North America.
Despite challenges in the wine industry, premiumization remains a key driver for companies like Duckhorn.
Some critics have raised concerns about the acquisition, questioning whether it is in the best interest of Duckhorn’s shareholders.