Foley Family Wines plans to issue 2.03m shares to Lion NZ to partially fund Mt Difficulty Wine purchase
By Rebecca Howard
May 22 (BusinessDesk) - Foley Family Wines has entered into a conditional agreement to issue 2.03 million shares to Lion
- Beer, Spirits & Wine (NZ), the local unit of Japanese brewer Kirin Holdings, to partially fund its $55 million acquisition of Mt
Difficulty Wines. It also plans to make an offer to existing retail shareholders through a share purchase plan.
"Having Lion becoming an important stakeholder in FFW NZ is a fantastic next step in our journey in NZ. From a personal
perspective it reaffirms my desire to continue to invest in New Zealand," said chair of Foley Family Wines, US
businessman Bill Foley.
Under the terms of the conditional subscription agreement, the shares will be issued at $1.48 per share and the
placement forms part of a $20 million capital raising, it said in a release to the stock exchange. The NZAX-listed
company's shares last traded up 0.7 percent at $1.45. They have fallen 4 percent so far this year.
"If issued on the date of this announcement, the placement shares would have constituted 3.7 percent of Foley Family
Wines' post-issuance share capital," it said.
Foley Family Wines bought Mt Difficulty Wines last November subject to Overseas Investment Office approval, adding the
premium Mt Difficulty and Roaring Meg brands to its suite which already includes Vavasour, Grove Mill and Te Kairanga.
It expects the transaction to settle in June.
Today's deal with Lion is subject to a number of conditions which must be met by Dec. 31. These include confirmation the
OIO conditions has been approved or waived for the Mt Difficulty Wines purchase, an extension or replacement of an
existing agreement regarding the exclusive distribution by Lion of Mt Difficulty and Martinborough Vineyards wines in
New Zealand once the sale is complete, and no material adverse event that would mean Foley Family Wines was unable to
deliver a sufficient quantity of wine to Lion for its 2019 business plan under that distribution agreement.
Settlement and allotment of the shares will occur three business days after satisfaction of the conditions. Lion will
subscribe for the placement shares in cash, it said.
The wine company also said it intends to make a share purchase offer to existing retail shareholders with a registered
address in New Zealand at the same price as the subscription agreement. The record date for determining entitlements to
participate and other key dates will be announced shortly, it said.
(BusinessDesk)
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