Herbert Smith Freehills advises Treasury Wine Estates on its proposed acquisition of DAOU Vineyards and A$825 million entitlement offer

Herbert Smith Freehills is delighted to have advised Treasury Wine Estates (TWE) on its proposed acquisition of DAOU Vineyards (DAOU) and its underwritten pro-rata accelerated renounceable entitlement offer with retail rights trading to raise A$825 million to partly fund the acquisition (Entitlement Offer). 

TWE is one of the world’s leading premium wine companies, and is listed on the Australian Securities Exchange (ASX).

TWE has announced that it is acquiring leading luxury U.S. wine business DAOU, for an upfront consideration of US$900 million, plus an additional earn-out of up to US$100 million.

The Entitlement Offer proceeds will be used to partly fund TWE’s acquisition of DAOU. DAOU is a highly acclaimed luxury wine brand based in Paso Robles, California. DAOU owns the DAOU Mountain Tasting Room, four luxury vineyards, four wineries and 411 acres of vineyards in the Adelaida sub-district of Paso Robles, which will complement TWE’s existing sourcing and production base in the region.

The Herbert Smith Freehills team is led by partners Tim McEwen and Tony Damian, who are supported by executive counsel Cecilia Mehl, senior associate Ling Zhu, and solicitors Janice Chan and Andrew Owen.

Tim McEwen said, "We are very pleased to have again supported and advised our long-standing client, TWE, on its proposed acquisition of DAOU and the associated entitlement offer”.

Tony Damian said, “This is a very significant and exciting transaction that continues and accelerates TWE’s premiumisation strategy. We look forward to continuing to work with TWE”.

The Herbert Smith Freehills team worked closely with Sarah Turner, Chief Legal & Corporate Affairs Officer of TWE.

Herbert Smith Freehills advised on all Australian aspects of the acquisition, including the proposed issue of TWE shares to the current owners of DAOU, the associated share escrow arrangements, and all aspects of the Entitlement Offer.

Macquarie and UBS AG, Australia Branch are acting as joint lead managers to the entitlement offer.