Australian Whisky Holdings launches bid to buy Lark
Australian Whisky Holdings (AWH) has stated its intention to acquire all the ordinary shares in the Lark Distillery Pty Ltd, that it does not currently own: at present AWH holds 48.12 per cent of the shares in Lark.
AWH has been placed in an ASX trading halt pending an announcement to a capital raising, and it has stated that existing Lark shareholders may choose to receive either 12,500 AWH shares or $400 for every Lark share they own.
If all Lark shareholders accept the offer then AWH is liable for a cash bill of $10,708,800 or an issuance of 334,650,000 AWH shares or a combination of the two. AWH has said that given it currently holds 48.12 per cent of Lark it has not issued a minimum acceptance condition on Lark shareholder and until all acceptances are known, AWH will not know its level of Lark ownership.
In its statement to the ASX about the proposal, AWH stated its rationale for the bid, saying: “As previously announced, [AWH’s] business strategy is to pursue partnerships with selected distilleries in the Australian craft whisky industry. In addition to its existing shareholding in Lark (and indirectly Overeem) in 2017 [AWH] completed its purchase of the business of Nant Distillery, including the premises at the historic Nant Estate in Bothwell, Tasmania. [AWH] has a 12 per cent shareholding in Tasmanian Whisky Producer Redlands Estate Pty Ltd.
“The vision of [AWH] is to have equity holdings, if not ownership, in a number of premium single malt whisky producers in Australia, focusing in particular on Tasmania. [AWH] proposes to accelerate growth in the craft whisky industry ahead of competitors and take a leadership position in the industry. In doing so, [AWH] intends to lead the structuring and development of, and be instrumental in, defining the final shape of the craft whisky industry in Australia and maintaining Tasmania’s leadership position in this country.
“[AWH] believes by doing this, it will provide current craft producers a platform to increase volume and it will give each brand an ability to increase profits and distribution into higher margin markets in Asia.
“[AWH] does not intend to interfere with the production of whisky and consolidate distilleries as it believes each distillery and distiller is unique in its production methods.”
AWH added that the offer to purchase the shares is being made conditional upon completion of its capital raising, obtaining any necessary ASX approvals and that the offer will be open until 20 April 2018.