Exclusive: Robert Hanson Named CEO At Duckhorn

Last month, Los Angeles-based private equity firm Butterfly completed its $1.95 billion acquisition of luxury California wine player Duckhorn. Today, SND can exclusively report that former Constellation Wine & Spirits president Robert Hanson has been appointed chief executive at Duckhorn, succeeding Deirdre Mahlan, effective February 1. Hanson led Constellation’s wine and spirits unit from 2019 through 2023, overseeing the streamlining and premiumization of the portfolio. His luxury wine credentials will be an asset at Duckhorn, which plays in a wide range of quality wines across the premium and above tier and has volume of approximately 2.7 million cases, according to Impact Databank, with 2024 sales of $475 million.

Looking forward, Butterfly co-founder and co-CEO Adam Waglay believes Duckhorn has ample potential for expansion, via both organic growth and acquisitions. Prior to founding Butterfly—whose portfolio companies combine for $6.5 billion in revenue—he was a member of KKR’s Consumer Retail Private Equity team with a primary focus on the food sector. SND executive editor Daniel Marsteller met with Waglay and Hanson in New York to discuss the future of Duckhorn and the broader opportunity in California wine.

SND: Can you give us an introduction to Butterfly, since it’s a new name in the business to many of our readers?

Waglay: We’ll have our 10th year anniversary this year. I’ve been investing in food and beverage for about 20 years. I was at KKR before this and at Goldman Sachs before that. And what’s interesting is that the food space is a $26 trillion space globally, which makes it the biggest industry in the world and actually the highest growth industry in the world. But within that, we’re very methodical about where in food that we will play.

The part of wine we’re most intrigued by is premium and luxury wine, exactly where Duckhorn plays, at $15-$50 a bottle. There’s a 7% annual growth rate on that space over the last 12 years and it’s been taking share. So one, it’s the right price point. Two, we really like the asset-light nature of this business. 90% of Duckhorn’s grapes are third-party sourced through incredible grower relationships, and that’s not only great from an asset-light perspective, but leads to really high margins.

We were able to acquire this business at a meaningful discount to where wine assets like this typically trade, and we think that’s because of the dynamics in the industry today. So this is when to lean in. We also see this as an M&A platform where we think we can roll up other incredible assets in the business.

SND: As a veteran of the industry, what’s attractive about this opportunity, Robert?

Hanson: The Duckhorn Portfolio has contributed 30% of the growth of the $15-plus wine category over the last several years. We’re competing in the right space in the market. The portfolio includes the core four brands of Duckhorn Vineyards and Kosta Browne along with Decoy and now Sonoma-Cutrer, plus seven other brands including Calera, Goldeneye, Greenwing, Paraduxx, Migration, Canvasback, and Postmark. (Editor’s note: Kosta Browne’s 2009 Sonoma Coast Pinot Noir was Wine Spectator’s Wine of the Year in 2011, while Duckhorn’s Merlot Napa Valley Three Palms Vineyard 2014 earned the same honor in 2017.)

We see tremendous distribution opportunity both domestically and internationally. The direct-to-consumer business is also underdeveloped. International is only 6% of the business, and DTC is only 12%, with 82% being wholesale distributed domestically.

The company’s been really well run and the growth rates substantiate that. It’s a great operating model, and with Butterfly’s contributions to strategy, operations, and their investment capability, there’s a lot of potential. We believe over time this portfolio can be clearly positioned as the number-one premium and luxury still wine competitor in the world.

SND: Besides the investment itself, what does Butterfly bring to the table in terms of growing the business?

Waglay: We’re food specialized, and our companies sell to all the top retailers in the country. We know all the top restaurant companies out there as well from a food service perspective. So we have a lot of relationships and know-how. The second part of our model that’s really important is roughly half of our team are operational people that Robert’s gotten to know really well. These are folks who are former food consultants, former food operators who we deploy to help executives. That team will help Robert to drive transformation. If you look at Robert’s track record, he’s been incredible at building, transforming, and growing businesses.

Hanson: They’ve been students of the wine category for a long time. There’s a number of folks on the investment committee that know the space really well. What I love about their model is not only is it an investment strategy, but it’s backed by the strategic and operations team. The category needs commitment both operationally and from an investment standpoint, and they’ll back their investment up with the capital necessary to grow the business.

We’ll have more with Adam Waglay and Robert Hanson in the second part of this interview.

Tagged : Butterfly, Decoy, duckhorn, Sonoma-Cutrer

GET YOUR FIRST LOOK AT 2025 ESTIMATES AND 2030 PROJECTIONS FOR THE WINE AND SPIRITS INDUSTRIES. ORDER YOUR 2025 IMPACT DATABANK REPORTS. CLICK HERE.