Duckhorn Wine Company, a Napa Valley-based portfolio of wineries headed by Duckhorn Vineyards, filed with the U.S. Securities and Exchange Commission (SEC) on 23 February, announcing its intention to go public and raise $100 million in an initial public offering. Renaissance Capital estimates the figure could rise to as much as $300 million.
Duckhorn has been owned since 2016 by TSG Consumer Partners, a private equity company headquartered in San Francisco that controls $9 billion in assets. The company plans to list on the New York Stock Exchange under the symbol NAPA.
Its labels include Duckhorn Vineyards, Decoy, Kosta Browne, Goldeneye, Paraduxx, Calera, Migration, Canvasback, Greenwing in Washington State, and Postmark, sold in all 50 states and more than 50 countries at prices from $20 to $200 a bottle. The company runs eight wineries and 22 sustainably farmed estate vineyards covering 843 acres.
For the twelve months to 4 October 2020, The Duckhorn Portfolio was the largest premium wine supplier in the United States and the eleventh largest wine supplier by total market volume.
From 1,600 cases in 1978
Margaret and Dan Duckhorn built their winery on a 10-acre property just north of the town of St. Helena, which is still home to its main winery and visitor facilities. The first vintage, in 1978, ran to only 1,600 cases.
The business has grown fast over the last six years, and the IPO will raise money for further growth and acquisitions. It also gives TSG a route to reduce its holding, after reports that the firm had explored a sale before settling on a listing. Duckhorn bought Central Coast Pinot Noir maker Calera in 2017 and Sonoma Pinot Noir specialist Kosta Browne in 2018.
Merlot trendsetter
Duckhorn Vineyards is known in the United States and abroad for its Napa Valley Merlot, and it is one of North America’s leading producers of Bordeaux-style wine. Bordeaux blends of Cabernet Sauvignon, Merlot and Petit Verdot do very well in the Napa Valley, and in the 1970s many Napa vineyards followed that traditional model.
Duckhorn was one of the first to bottle Merlot on its own. In Bordeaux, especially in Pomerol, the right-bank wines are built on Merlot, and Dan Duckhorn felt the grape was underloved in North America. As a single variety it can make soft, seductive wines, and at the end of the 1970s the market was ready for premium wines with wide appeal. Duckhorn arguably started the fashion for Merlot in California, a fashion the film Sideways later made fun of.
The vineyards of Howell Mountain
Dan and Margaret Duckhorn have always put the emphasis on choosing the best fruit, whether from carefully sourced sites around the Napa Valley or from their own estate. The winery’s seven estate vineyards are spread across the valley’s alluvial fans and the prized slopes of Howell Mountain, each with its own microclimate.
That gives winemaker Bill Nancarrow a range of vineyard blocks to choose from, each with its own flavour profile, and by treating each block separately he can pick when the flavours are at their best and the tannins at their softest. Grapes are picked by hand, often in several passes through the same vineyard so that only ripe fruit comes in each time. In 2017, Duckhorn’s Three Palms Vineyard Merlot 2014 was named Wine Spectator’s Wine of the Year.
Archive note: First published in February 2021 in my California wine column on NewsBreak. It reflects the situation when Duckhorn announced its plans, before the shares began trading, and figures are as reported at the time.
More from my NewsBreak California wine column: Duckhorn goes public · Four in five American wines · New York State wine · The 2020 vintage after the fires · Trinchero, or see all five on the NewsBreak column page.
