Strategic View: Butterfly Equity acquires North America’s premier luxury wine company Duckhorn Portfolio for $1.95 billion in an all-cash transaction at $11.10 per share, marking one of 2024’s largest food & beverage club deals. The transaction closed December 23, 2024.
Full story: The wine industry just got a private equity makeover. Butterfly Equity, a Los Angeles-based specialist in food and beverage investments, completed its $1.95 billion acquisition of The Duckhorn Portfolio, taking the luxury wine producer private after trading on the NYSE. This wasn’t a solo mission—it’s a classic club structure where Butterfly leveraged debt financing and likely syndicated equity stakes to family offices and co-investors familiar with consumer discretionary assets.
Duckhorn operates eleven wineries across 2,200 acres of premium vineyards, producing brands that command pricing power in the ultra-premium segment. The thesis? Public markets don’t reward patient capital in cyclical luxury goods. By going private, Butterfly can optimize the portfolio, consolidate operations, and potentially spin off non-core brands without quarterly earnings pressure. The $11.10 price represented a premium that satisfied ISS recommendations after initial shareholder pushback.
This deal signals that Premiumization remains investable even in uncertain economic times. Luxury wine benefits from brand moats and pricing resilience among high-net-worth consumers. For club deal participants, the risk is distributed across portfolio construction, debt tranches, and operational expertise. Expect similar take-privates in spirits and artisanal food categories as PE firms hunt for inflation-resistant consumer brands with EBITDA margins above 25%.
Summary: Butterfly Equity takes Duckhorn Portfolio private for $1.95 billion, betting that luxury wine brands perform better outside public market scrutiny. The club structure allowed distribution of risk across what is essentially a real estate play (vineyards) combined with brand value. This is premiumization meets patient capital.
Source: Business Wire, Reuters
