Fueling speculation that an initial public stock offering is imminent, Kendall-Jackson Wine Estates Ltd. has hired the chairman of Hewlett-Packard, Lewis Platt, as its new CEO. The longtime Silicon Valley executive will take over the reins of the Sonoma County-based company in January, working with the winery's founder and principal owner, Jess Jackson, who remains as chairman.
For more than three years, reports have circulated that Kendall-Jackson -- maker of some of California's most popular premium wines -- has been considering an IPO, following the path of other large California wine companies that have gone public, such as Beringer Wine Estates and Robert Mondavi Winery. But Kendall-Jackson would not confirm that it is any closer to taking that step. "We have been considering that option for a long time, and that considering of options continues," said spokesman James Caudill.
Though Platt, 58, has no previous experience in the wine industry, he has been an avid wine collector for years, Caudill noted. The winery's management team also includes Leonard Cairney, a veteran of the wine industry, who came to K-J in 1998 from Beaulieu Vineyard in Napa Valley, where he was president. Under the new arrangement, Cairney, who had been CEO, becomes chief operating officer.
As the former head of a Fortune 500 company that generated net revenues of $47.1 billion in 1998, Platt commands respect within the financial community, which Caudill said was important as Kendall-Jackson continues to grow. Platt spent more than 30 years with Hewlett-Packard and was named president and CEO of the computer company in 1992. One year later, he succeeded cofounder David Packard as chairman.
"This is an extremely well-known, high-profile, competent, experienced executive," said George Coope, a principal in San Francisco-based Hambrecht & Quist, which handled the initial public offerings of Mondavi and Beringer. "If [K-J] wanted to do an IPO, this would certainly give them the increased management depth that would make that more feasible."
Jackson, 69, said he will continue to play an active role in the company, but after nearly two decades at the helm, he is now ready to pass on more responsibilities to a seasoned leadership team. His family also owns the Artisans & Estates collection of wineries -- including Hartford Court, Lokoya, Cardinale, Legacy, Cambria and Stonestreet -- and he will devote more of his time to that group.
Jackson founded Kendall-Jackson in 1982, and building on the popularity of its Vintner's Reserve Chardonnay, the winery rapidly grew, with sales exceeding 3 million cases last year. Last week, the company announced that it had changed its name from Kendall-Jackson Winery to Kendall-Jackson Wine Estates Ltd. to reflect the numerous wine brands it now owns. Kendall-Jackson now includes several wineries -- Calina in Chile, Tapiz in Argentina and Edmeades in Mendocino County -- as well as the Camelot brand produced at Kendall-Jackson's new Monterey winery.
"Sooner or later, it was inevitable that Jess might begin to take a step back," said Caudill. "Over the last several years, he has been putting in place an experienced management team that he was comfortable would carry on his vision."
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