Duckhorn’s Bold Move: Acquiring Sonoma-Cutrer to Reign Supreme in the Luxury Chardonnay Market
Napa Valley’s renowned Duckhorn has inked a deal to acquire Sonoma-Cutrer, encompassing its expansive vineyards across the Russian River Valley and Sonoma Coast appellations. This major move, set to finalize in the third quarter of fiscal year 2024, marks Duckhorn’s strategic expansion into the lucrative Chardonnay sector.
Celebrated for its exquisite Chardonnays, Sonoma-Cutrer emerged in 1973, debuting its first wine in 1981. Known for its high-end offerings priced between US$20 and US$50, it has been under Brown-Forman’s ownership since 1999. As of July 31, 2023, Sonoma-Cutrer boasts a net sales figure of approximately US$84 million.
In this strategic acquisition, Brown-Forman maintains a minority stake and board representation, eager to contribute to Sonoma-Cutrer’s continued success. Duckhorn’s interim president and CEO, Deirdre Mahlan, expresses enthusiasm about integrating Sonoma-Cutrer into their prestigious lineup of luxury wines, envisioning a bright future for both brands.
The agreement entitles Brown-Forman to nominate two directors to The Duckhorn Portfolio’s board. They will receive 31.5 million shares in Duckhorn’s common stock, valued around US$350 million, along with a cash consideration of about US$50 million, subject to adjustments.
With this acquisition, Sonoma-Cutrer joins an illustrious collection of wineries under The Duckhorn Portfolio, including Duckhorn Vineyards, Decoy, Paraduxx, Goldeneye, Migration, Canvasback, Calera, Kosta Browne, Greenwing, and Postmark.
