ASX-listed craft beverages accelerator Mighty Craft (formerly known as Founders First) has acquired Adelaide Hills Distillery, Mismatch Brewing and Hills Cider.
The $47 million acquisition of parent company Adelaide Hills Group (AHG) also includes 75 per cent of Lot 100, their joint venture cellar door that opened in 2018.
The remaining 25 per cent of Lot 100 will be retained by the other co-founders, juice company Ashton Valley Fresh and winemaker Vinteloper.
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“As well as the venue and brands, AHG have an efficient and cost effective production brewery renowned for making award-winning craft beer profitably with scope to expand, providing the Mighty Craft group with access to production cost savings,” Mighty Craft informed the ASX.
“World class distilling talent in Adelaide Hills is added to the Mighty Craft portfolio supporting the acceleration of the ambition to become a leading player in craft spirits and particularly the craft whisky market.”
Mighty Craft previously announced it had partnered with former Australian Whisky Holdings CEO Chris Malcolm in a new whisky business.
In April this year, it announced the appointment of former Glenfiddich distiller George Campbell as production manager and group distiller as part of an acceleration of its whisky operations.
One of Australia’s largest craft distilleries
The acquisition is expected to increase Mighty Craft’s spirit production capacity to 1.5 million bottles in FY22, making it MCL one of Australia’s largest independent craft spirit producers.
The combination of the two businesses will increase Mighty Craft’s forecast consolidated revenue for FY22 by 57 per cent to $78.7 million, with forecast underlying EBITDA in FY22 expected to be $6 million, including synergies.
“This increased scale and the opportunity to realise significant synergies will truly leverage our operating platform and enhance Mighty Craft’s ability to accelerate growth of new and existing craft businesses,” says Mighty Craft managing director Mark Haysman.
“A key ingredient to achieving our objective is having the talented and highly specialised production and management team from these four fantastic businesses come join us at Mighty Craft to help integrate the brands, from a production, distribution, sales and marketing perspective, into the Mighty Craft portfolio.”
AHG’s Toby Kline said: “We have joined forces because we believe the two businesses are stronger together and can really create something special over the coming years.”
The acquisition will be in the form of $27 million in cash and $20 million in shares to be issued to the sellers of AHG.
Mighty Craft has announce a $29 million capital raise to fund the deal, which is subject to shareholder approval at a general meeting on July 12, 2021.
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