Wines & Vines

AUGUST NEWS Truett Hurst Goes Public at Reduced Value Company plans to use proceeds from offering to pay down debts H ealdsburg, Calif.—Truett Hurst Inc. wine company sold 2.7 million shares of its Class A common stock to the public at $6 per share June 20, then saw the stock price dip as low as $5.30 before settling around $5.80. The stock is traded on the Nasdaq Capital Market under the symbol "THST." The stock raised $14.1 million, far less than was anticipated when the company announced its plans to sell 2.9 million shares at a price of $11-$15 in SCREW Making the move to screw cap? Want to run roll-on and torque-on with the same machine? Arol's flexible capping technology applies everything from corks, to torque-on aluminum closures. We custom design your machine for your specific application. With over thirty years' experience and 15,000 machines to-date, we have a perfect solution for your application. Contact us at: AROL North America 450 Satellite Blvd NE | Suite A Suwanee, GA 30024 | Tel: 678.318.1290 www.arol.com 16 W in e s & V i ne s AU G U ST 20 13 late March ($32 milwinesandvines.com Learn more: lion to $45 million Search keywords "Truett Hurst." total). This marks the first initial public offering for a North Coast wine company in 13 years. Crimson Wine Group (parent of Pine Ridge, Archery Summit, Chamisal Vineyards and Seghesio Family Vineyards) was recently spun off as a public company, however. Truett Hurst intends to use the net proceeds from the offering to pay down debts estimated at $2.5 million according to a June 7 report by small-cap underwriting and research firm Sidoti & Co. LLC, which co-managed the IPO. The initial proposal called for executives and directors to sell stock, but they held back about 200,000 shares in the final offering. Those individuals still hold controlling interest with 40% of the stock by value and 60% of the voting power. Truett Hurst's total revenues during the fiscal year ending June 30, 2012, were $12.7 million, a 135% increase from $5.4 million during fiscal year 2011. Truett Hurst produces and sells more than 30 brands—some in partnership with major retailers, and some independently. The company manages a custom-label business that builds brands for exclusive sale through retailers while retaining brand ownership. Private-label business accounts for 72% of Truett Hurst's estimated sales for fiscal year 2013, according to the prospectus for the offering, with traditional three-tier sales comprising 10% and direct-to-consumer sales accounting for 18%. Truett Hurst owns wine producer and marketing company HDD LLC, which was founded by Phillip Hurst (a veteran of another publicly owned wine company, Golden State Vintners, and co-founder of Novato-based Winery Exchange) and Paul Dolan III, who helped build Fetzer Vineyards into a large winery. Truett Hurst partner Bill Hambrecht, an investment banker who helped Ravenswood Winery go public in 1999, was the architect of the IPO. The offering was led by W.R. Hambrecht + Co. —Paul Franson

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