Truett-Hurst, the fast-growing Healdsburg wine company, announced plans Wednesday to sell up to $42 million in stock in the North Coast wine industry's first initial public offering in 13 years.
The company will offer 2.25 million shares of stock, and its investors, primarily the original founders, will sell 652,557 of their personal shares in the IPO, according to documents filed with the U.S. Securities and Exchange Commission.
The estimated price range for the initial public offering is $11 to $15 per share. Shares would be listed on the Nasdaq Capital Market under the symbol "THST."
The offering is a way for the company to secure capital it needs to continue its growth, said Phil Hurst, its co-founder, president and CEO.
"We had to do something now. And we got kind of lucky with the markets and the wine industry," Hurst said. "The economy is doing great, the stock market is strong, and a lot of people are investing in the stock market now because interest rates are so low."
The company was launched in 2007 by Hurst and partners Paul and Heath Dolan and investment banker Bill Hambrecht. Hurst, the Dolans and winemaker Virginia Marie Lambrix are selling the lion's share of the personal stock available during the IPO.
Few wine companies go public, and Truett-Hurst is the first to sell stock on Wall Street since Ravenswood went public in 1999, following IPOs earlier that decade by Mondavi and Beringer.
"Most wine companies are driven by vineyards and wineries and hard assets, and it's always tougher to get their profits out," said Joe Ciatti, principal at Zepponi & Co., a mergers and acquisitions advisory firm. "People are more in tune to investments now. I think wineries have a little more luster, and people are feeling comfortable about the position of the wine industry."
If the IPO is successful, it could stimulate other wine companies to follow suit, Ciatti said.
Truett-Hurst reported $12.6 million in sales for the fiscal year ending June 30, 2012, up from $5.4 million the previous year. It posted a profit of $26,462 last year, compared to a loss of $820,815 the previous year.