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Duckhorn Details Plans For Forthcoming IPO

March 11, 2021

St. Helena, California-based Duckhorn has unveiled more details for its upcoming initial public offering. Duckhorn has filed with the SEC to offer 20 million shares of common stock to the public at an individual value of $14-$16. Of the 20 million shares, 13.3 million are being offered by the company and 6.6 million are being offered by its existing stockholder. The SEC filing also discloses an option attached to sell an additional 3 million shares, placing the maximum value of the offering at $368 million. At the midpoint of the proposed IPO range Duckhorn would have a fully diluted market value of $1.8 billion, according to Renaissance Capital.

Duckhorn had $270.6 million in net sales in its fiscal 2020 ended in July, up from $241.2 million the year prior, and an adjusted EBITDA above $100 million. The company has sustained a compound annual growth rate of around 18% over the past five years, according to the filing. In a letter to prospective stockholders, Duckhorn CEO Alex Ryan cited “the opportunities to introduce new wines, open new accounts, enter new categories and markets, explore new wine regions, and find new ways to connect with consumers. We believe our ability to conquer these opportunities is greater than it has ever been and that our best years are yet to come.”

Duckhorn has been owned since 2016 by San Francisco-based private-equity firm TSG Consumer Partners, which manages $9 billion in assets. Duckhorn is represented across a variety of price points—from $20 a bottle to $200—through its brands Duckhorn Vineyards, Decoy, Goldeneye, Paraduxx, Canvasback, Migration, Postmark, and Kosta Browne, among others. Decoy by Duckhorn, retailing in the $25 range, has been a major growth driver, averaging 23% annual volume growth over the past three years to reach 1.1 million cases in the U.S. in 2020, according to Impact Databank.

The company expects to collect net proceeds of $181 million from the public offering, which it plans to use to “increase our capitalization and financial flexibility … for general corporate purposes, including working capital, operating expenses, and capital expenditures.” It has reserved the symbol NAPA on the New York stock exchange.—Danny Sullivan

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