Adds Two New Members to the Board of
Directors
The Duckhorn Portfolio, Inc. (NYSE: NAPA) (the “Company”)
announced the completion, effective April 30, 2024, of its
acquisition of Sonoma-Cutrer Vineyards (“Sonoma-Cutrer”), one of
the largest and fastest-growing luxury Chardonnay brands in the
U.S., from spirits and wine company, Brown-Forman Corporation
(NYSE: BF.B) (“Brown-Forman”). The Duckhorn Portfolio has named two
Brown-Forman executives to its Board of Directors, Marshall Farrer,
Chief Strategic Growth Officer, and Tim Nall, Chief Global Supply
Chain and Technology Officer.
The Company finalized the acquisition for the previously
announced consideration of approximately $50 million of cash and
the issuance of 31,531,532 shares of Company common stock to
Brown-Forman.
“We are thrilled to add the acclaimed Sonoma-Cutrer winery brand
to our portfolio of luxury winery brands and welcome their talented
team,” said Deirdre Mahlan, President, Chief Executive Officer and
Chairperson of The Duckhorn Portfolio. “The addition of these
iconic and carefully curated wines to our offering broadens our
reach in the luxury Chardonnay category and further cements our
place as the premier pure-play producer of luxury wine in the US.
We believe this acquisition will enhance our ability to deliver a
full portfolio of luxury wines to the consumer, and further advance
our ambition to drive consistent, profitable growth and create
meaningful value for all our stakeholders.”
Since its founding in 1973, Sonoma-Cutrer has become one of
California's best-known and fastest-growing luxury Chardonnay
winery brands. This acquisition bolsters The Duckhorn Portfolio by
significantly elevating the Company’s position within the
Chardonnay category, the number one domestic white varietal. The
brand strength and scale of this acquisition is expected to extend
the Company’s reach to a broader base of consumers and trade
partners, further enabling The Duckhorn Portfolio to outpace
industry growth.
Key Benefits
- The acquisition is expected to be accretive in the first full
fiscal year based on expected run-rate synergies, which are now
expected to exceed the Company’s initial estimate of $5
million.
- The Company anticipates additional opportunities to accelerate
net sales growth as a result of Sonoma-Cutrer’s complementary
placement within the existing brand and varietal architecture and
relatively limited account overlap.
- The Company expects further optimization of the grape supply
and production model with the addition of 1,121 acres of estate
vineyards in the Russian River Valley and Sonoma Coast
appellations.
- The Company welcomes Brown-Forman, a leader in beverage alcohol
with over 150 years of industry experience, as a well-respected
shareholder and looks forward to the contributions of Marshall
Farrer and Tim Nall as members of The Duckhorn Portfolio Board of
Directors.
- The acquisition terms allow the Company to maintain its current
debt leverage ratio, affording the financial flexibility to drive
future growth.
About Marshall Farrer
Marshall Farrer is the executive vice president, chief strategic
growth officer for Brown-Forman. Marshall began his career at
Brown-Forman in 1998, as a marketing manager in the Wine Division
in California, where he held several sales and marketing management
positions. In 2004, he was named vice president, chief of staff to
the president of Brown-Forman’s Spirits Americas. In 2006, he was
appointed as director of Latin America and the Caribbean. In 2010,
he relocated to Sydney, Australia, and was named the managing
director, Australia, New Zealand, and South Pacific. In 2014, he
shifted to marketing as the managing director of Jack Daniel’s
Tennessee Honey, leading its global expansion. Shortly after in
2015, he was promoted to senior vice president, managing director
of global travel retail, and in 2018 added the responsibility of
Developed Asia Pacific, including North Asia, Australia, and New
Zealand. In 2020, Marshall was named president of Europe and joined
the Executive Leadership Team. In addition, he became
Brown-Forman’s first chief strategic growth officer in 2023 and
transitioned to the role full-time in early 2024. Mr. Farrer has
served on Brown-Forman’s board of directors since 2016 and is a
fifth-generation Brown family shareholder. He graduated from
Rollins College with a Bachelor of Arts and holds a Master of
Business Administration degree from Tulane University.
About Tim Nall
Tim Nall is the executive vice president, chief global supply
chain and technology officer for Brown-Forman. Since 2000, he has
held positions of increasing responsibility within Brown-Forman’s
Global Production group, including director of campus production
operations, vice president and general manager of Brown-Forman
Wines, vice president, director of technical services, and most
recently, senior vice president, chief information and advanced
analytics officer. Prior to Brown-Forman, he was employed by Alcoa,
American Air Filters, and S.S.T.I. (Ford Motor Company/Johnson
Controls joint venture). He earned a Bachelor of Science in
Electrical Engineering from the University of Louisville JB Speed
School of Engineering. He later earned a Master of Business
Administration at University of Louisville with a concentration in
operations management.
About The Duckhorn Portfolio
The Duckhorn Portfolio is North America’s premier luxury wine
company, with eleven wineries, ten state-of-the-art winemaking
facilities, eight tasting rooms and over 2,200 coveted acres of
vineyards spanning 38 Estate properties. Established in 1976, when
vintners Dan and Margaret Duckhorn founded Napa Valley’s Duckhorn
Vineyards, today, our portfolio features some of North America’s
most revered wineries, including Duckhorn Vineyards, Decoy,
Sonoma-Cutrer, Kosta Browne, Goldeneye, Paraduxx, Calera,
Migration, Postmark, Canvasback and Greenwing. Sourcing grapes from
our own Estate vineyards and fine growers in Napa Valley, Sonoma
County, Anderson Valley, California’s North and Central coasts,
Oregon and Washington State, we offer a curated and comprehensive
portfolio of acclaimed luxury wines with price points ranging from
$20 to $230 across more than 15 varietals and 39 appellations. Our
wines are available throughout the United States, on five
continents, and in more than 50 countries around the world.
Forward-Looking Statements
This press release contains “forward-looking statements” within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. In some situations, you can identify forward-looking
statements by words such as “approximately,” “anticipate,”
“assume,” “believe,” “contemplate,” “continue,” “could,”
“estimate,” “expect,” “future,” “intend,” “may,” “plan,”
“potential,” “predict,” “project,” “seek,” “should,” “target,”
“will” and similar terms and phrases to identify forward-looking
statements. These forward-looking statements include, among others,
statements about the potential market opportunity resulting from
the acquisition of the Sonoma-Cutrer and associated business
strategy, the Company’s ability to better address certain markets,
expand its capabilities and position in the industry and extend its
product offerings to better serve our customers, as well as the
potential synergies and other financial benefits derived by and
financial impact to the Company from the acquisition. All of our
forward-looking statements are subject to risks and uncertainties
that may cause actual results to differ materially from those that
we are expecting, including: risks associated with transactions
generally; the failure to consummate or delay in consummating the
transaction for other reasons; the risk that a condition to closing
of the transaction may not be satisfied; the occurrence of any
event, change or other circumstances that could give rise to the
termination of the merger agreement; the outcome of any legal
proceedings that may be instituted following announcement of the
transaction; failure to retain key management and employees of
Sonoma-Cutrer; issues or delays in the successful integration of
Sonoma-Cutrer’s operations with those of the Company, including
incurring or experiencing unanticipated costs and/or delays or
difficulties; unfavorable reaction to the transaction by customers,
competitors, suppliers and employees; unpredictability and severity
of catastrophic events, including but not limited to acts of
terrorism, war or hostilities, as well as management’s response to
any of the aforementioned factors; and additional factors discussed
in the Company’s filings with the SEC.
The forward-looking statements contained in this press release
are based on management’s current plans, estimates and expectations
in light of information currently available to the Company and are
subject to uncertainty and changes in circumstances. There can be
no assurance that future developments affecting the Company will be
those that the Company has anticipated. Actual results may differ
materially from these expectations due to changes in global,
regional or local political, economic, business, competitive,
market, regulatory and other factors, many of which are beyond our
control, as well as the other factors described in Item 1A, “Risk
Factors” in the Company’s 2023 10-K filed with the SEC on September
27, 2023, and the Company’s 10-Q for the quarter ended January 31,
2024, filed with the SEC on March 7, 2024, and other documents the
Company may file with the SEC from time to time. Should one or more
of these risks or uncertainties materialize or should any of our
assumptions prove to be incorrect, our actual results may vary in
material respects from what we may have expressed or implied by
these forward-looking statements. Any forward-looking statement
made by the Company speaks only as of the date on which it is made.
All future written and oral forward-looking statements attributable
to the Company or persons acting on the Company’s behalf are
expressly qualified in their entirety by the previous statements.
The Company undertakes no obligation to publicly update any
forward-looking statement, whether as a result of new information,
future developments or otherwise, except as may be required by
applicable securities laws.
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version on businesswire.com: https://www.businesswire.com/news/home/20240501343676/en/
Investor Contact Ben Avenia-Tapper IR@duckhorn.com (707)
339-9232
Media Contact Jessica Liddell, ICR DuckhornPR@icrinc.com (203)
682-8200
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