Capstone Headwaters, a leading international investment banking firm, advised Gray Whale Gin (“Gray Whale” or “The Company”), and founders Marsh and Jan Mokhtari, on their joint venture with Deutsch Family Wine and Spirits (“Deutsch”). Buchalter LLP served as legal counsel to the Company on the transaction. Terms of the deal were not disclosed.
Gray Whale, one of the fastest-growing ultra-premium craft gins in the country, celebrates the incredible 12,000-mile migratory journey of the gray whale along the California coastline. The Company’s award-winning gin is made from a collection of botanicals foraged from the migratory path, including Juniper from Big Sur, Kombu sea kelp from the Mendocino Coast, limes from California, and mint from Santa Cruz. Through their membership with One Percent for the Planet, Gray Whale has pledged to contribute 1% of all sales to environmental causes.
Gray Whale Gin is currently sold throughout California and Connecticut, but has an aggressive expansion strategy. As part of the joint venture, Deutsch plans to rapidly expand distribution within the next 12 months. Deutsch says it intends to scale the brand through its national network, noting that the over-$30 gin segment is one of the fastest-growing, experiencing double-digit year-over-year growth. The brand joins Redemption Whiskey, Bib & Tucker Bourbon, Masterson’s Rye, and Luksusowa Vodka in the Deutsch spirits portfolio.
“Building a scaled spirits portfolio of craft and super-premium brands is a high strategic imperative for us,” said Deutsch President, Tom Steffanci. “We believe there’s significant opportunity to grow Gray Whale as we move to national distribution.”
Deutsch adds that the Mokhtaris—who created the brand after witnessing a gray whale and its calf on their annual 12,000-mile migration north—will be full-time partners on the project. In addition to distilling, Marsh Mokhtari has hosted various TV shows including Perilous Journeys on National Geographic and Extreme Chef on the Food Network. Jan is a creative director who has led brand-building campaigns at top ad agencies and movie studios. “Having a team like Shaun and David from Capstone shepherd us through the negotiations of an integral partnership was imperative to the success of the venture,” said Marsh Mokhtari, Co-Founder of Gray Whale. “Their level-headed, strategic knowledge of the industry and of the process always put our mind at ease and enabled us to make confident decisions.”
“The Mokhtari’s have built an innovative, exciting, and rapidly-growing brand, and it is an honor that they have entrusted us to represent the brand and help them evaluate multiple strategic alternatives in order achieve the objectives of both active and passive shareholders” said Shaun Kalnasy, Managing Director with Capstone Headwaters’ Food and Beverage Practice. “We are proud to have been able to help orchestrate such a great partnership and favorable outcome for all parties.”
Capstone Headwaters Managing Director David Brinkley added, “It has been a distinct privilege representing the Mokhtari family and we look forward to witnessing the expansion of this compelling brand in the years to come. The Duetsch Family’s focus on the long-term success of the brand was evident from our first conversations and was unwavering throughout the process, instilling real, sustainable confidence in the partnership.”