Top Shelf International has announced the sale of its plant and equipment at its Campbellfield production facility to Idyll Wine Co (IDL).
The sale includes all operational and production assets at the company’s Campbellfield facility, inclusive of its canning and bottling lines, brewhouse and distillery but excludes the company’s whisky maturation and warehouse facility at Somerton.
In addition, Top Shelf has agreed to the sale of a small portion of its excess bulk whisky inventory to IDL.
The total consideration is $8million (subject to adjustment for certain historical entitlements of transferring employees) and is to be paid in cash.
Proceeds received from the sale of the operational and production assets and the excess bulk whisky will be applied towards transaction costs and reducing the company’s debts, including the reduction of the company’s outstanding ATO excise liability.
Concurrently, Top Shelf intends to enter into a co-packing arrangement with IDL for the production of its branded products following the completion of the sale.
Top Shelf International is a Melbourne based distiller and marketer of premium Australian spirits, with brands including NED Australian Whisky, Grainshaker Hand Made Australian Vodka and Act of Treason Australian Agave.
Top Shelf requested a suspension of trading on the ASX on 27 September 2024.
CEO Trent Fraser confirmed it was due to the company not being in a position to release its audited financial statements on 30 September 2024.
Fraser said Top Shelf was in the process of negotiating with its senior lender and its largest creditors.
Fraser said the company would “closely review” its operating strategy while it is suspended from trading, adding that it “continues to progress discussions with a number of parties regarding the provision of funding and potential transactions to address its short- to medium-term operating needs and the repayment of outstanding creditors.”
He said the suspension would allow Top Shelf to finalise a “funding pathway” while conserving cash. It is expected to finalise the review in the fourth quarter of 2024.
In its financial results for the year ending 30 June 2024, the company reported a gross profit increase of 17.9%, from $6 million to $7.17 million.