Mighty Craft has announced it has entered into an agreement to sell award-winning Mismatch Brewing and 78 Degrees distillery to a consortium of publicans led by former CUB CEO Peter Filipovic.
As part of the transaction, the assets associated with Mismatch and 78 Degrees, including the brands and all intellectual property, trading names, contracting arrangements, inventory, plant and equipment, and licences will be sold for $7.2
million.
The sale also includes the assignment of the leases for the Mismatch Brewhouse venue and the Mismatch and 78 Degrees
production facility in South Australia.
Mismatch has a main brewhouse and taproom in the Adelaide Hills and a brewpub in Adelaide that was formerly the home of female-led Sparkke Brewing. Mighty Craft had a major interest in Sparkke until it cancelled its shareholding in 2022. Sparkke has since ceased to operate.
Mighty Craft said it is intended that approximately half of the proceeds of the sale will be paid to senior lenders as partial repayment of its outstanding debt facilities and the other half will fund the ongoing operations of the business.
While the timing of completion of the sale is uncertain, the parties are currently targeting a settlement on or prior to 31 May 2024.
The sale follows Filipovic’s group of publicans buying Jetty Road from Mighty Craft late last year for $3 million, followed by Hills Cider.
“I did some research on the brand, spoke to a few people, one idea led to another, and we ended up getting a group of people to buy it,” Filipovic (above) told The Crafty Pint.
“I think beer’s always been a good market to be in if you produce a good beer and make it relevant to consumers,” he says. “Whatever that might look like.”
The new ownership group, Jetty Road Publicans, also includes comedian Mick Molloy and Richard Ludbrook, who runs the Riverland Group, which operates six Melbourne venues.
Mighty Craft bets on Better Beer
Mighty Craft wants to retain its 33% interest in the fast-growing Better Beer brand, which was launched by comedians Jack Steele and Matt Ford of The Inspired Unemployed.
Mighty Craft chief executive Katie McNamara told the Australian Financial Review: “It’s growing well ahead of the market, in what is a difficult market. It is a business with enormous potential.”
Mighty Craft’s accounts for the six months to December 31 showed that Better Beer’s sales increased by 32% to $26.1 million, compared with a year earlier.
McNamara said that Mighty Craft would attempt more asset sales to pay down loans. It would also consider a knockout offer for its Better Beer stake.
Mighty Craft’s debts include a $20.9 million loan from Pure Asset Management and an $8.8 million bill from the Australian Taxation Office.