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Billion-dollar Stag’s Leap Wine Cellars Sale A Tactic To Bid Up The Price Up From A Fraction Of That

November 14, 2021 | Filed under Featured Articles | Posted by

 

Bloomberg reported on Nov. 11 that Sycamore Partners was “Weighing $1 Billion Sale of Stag’s Leap Wine.”

 

The Bloomberg article stated that, “Sycamore Partners is considering selling Stag’s Leap Wine Cellars for about $1 billion just one month after acquiring the label from Altria Group Inc., according to people with knowledge of the matter.”

 

They might be weighing that — with their thumb firmly on the scale,” one major wine industry acquisition player told Wine Industry Insight. (WII).

 

“They’re playing you,” another prominent savvy winery investor referring to WII‘s inclusion of a link to the Bloomberg article in our daily News Fetch executive business briefing. “Someone is promoting the larger number in order to boost the sale price.”

 

One of the investment sources noted in a phone call to WII that he had seen the offering being shopped by J.P.Morgan: “It’s closer to $XXX million.” [Premium subscriber data].

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White-shoe pump-and-dump?

A third source called it a “white-shoe pump-and-dump.”

 

In an email to WII, a spokesman for Sycamore Partners said, “Sycamore has no comment.”

 

Because of the size of J. P. Morgan, WII was unable to locate anyone qualified to deny or comment on the statements.

 

Sycamore acquired Stag’s Leap Wine Cellars as part of its purchase of Ste. Michelle Wine Estates. That acquisition was announced on October 1.

 

The Bloomberg article stated that “Stag’s Leap is expected to attract interest from high-net worth family offices and other private equity firms, the people said. No final decision has been made and Sycamore could elect to keep the business.”