Brown-Forman Reaches Deal on Sonoma-Cutrer Vineyards

News

November 17, 2023

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Brown-Forman (NYSE: BFA, BFB) announced that The Duckhorn Portfolio, Inc. (“The Duckhorn Portfolio,” NYSE: NAPA), a premier wine group, will acquire Sonoma-Cutrer Vineyards and related brand trademarks.

In exchange, Brown-Forman will receive an ownership percentage of approximately 21.5% in The Duckhorn Portfolio and $50 million USD. The transaction, subject to certain customary closing adjustments and conditions, is expected to close in the fourth quarter of fiscal year 2024.

“The Duckhorn Portfolio has a strong reputation for producing and marketing some of the world’s finest wines,” said Lawson Whiting, President and Chief Executive Officer, Brown-Forman Corporation in a news release.  “Their understanding of the wine consumer, combined with a strong and diverse route to market, give Brown-Forman great confidence that Sonoma-Cutrer will continue to grow and thrive as part of the larger Duckhorn portfolio,”

Whiting continued, “Adding Sonoma-Cutrer to the Duckhorn portfolio will enhance one of the most respected wine portfolios in the industry. Moreover, we believe an equity stake in The Duckhorn Portfolio will be a valuable investment for Brown-Forman, allowing us to maintain a presence in the wine category while focusing resources on building our premium and super-premium spirits brands.”

Under the terms of the agreement, the Sonoma-Cutrer brand trademarks, facilities, and six vineyards in two appellations will join The Duckhorn Portfolio’s fine wine brands. Upon closing, Brown-Forman will receive two seats on The Duckhorn Portfolio’s Board of Directors.

Deirdre Mahlan, The Duckhorn Portfolio’s Interim President, Chief Executive Officer and Chairperson added, “Sonoma-Cutrer has a long history of excellence in crafting fine wines and will be an outstanding addition to our portfolio of luxury wines. We will be fortunate to welcome Brown-Forman, a storied industry leader, as a long-term shareholder and look forward to their representation on our board.”

Sonoma-Cutrer has been crafting wines since 1981 and is one of California’s best-known Chardonnay brands. Brown-Forman purchased the vineyards and brand trademarks in 1999. Sonoma-Cutrer is now the third-largest luxury Chardonnay brand in the U.S. by retail sales and the fastest growing major brand in the category, according to Circana, formerly IRI.

Brown-Forman’s financial advisor is Greenhill & Co., LLC and its legal advisors are Gibson, Dunn & Crutcher LLP and Coblentz Patch Duffy & Bass LLP.

For more information about the company, please visit brown-forman.com.

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