BURONGA Hill Winery owner Australian Vintage has halted trading in its shares after merger talks stopped.
On Monday the company, which owns the McGuigan, Tempus Two, Nepenthe and Passion Pop brands, asked the Australian Securities Exchange for shares to be suspended until it can issue an update on capital raising and debt refinancing, expected about June 11.
Australian Vintage told the ASX its debt levels were likely to reach $70 to 75 million by June 30 – more than 50 per cent higher than previous guidance.
The Australian Financial Review reported that the company had been sent a letter by larger group Accolade Wines last Wednesday halting three months of merger talks, saying Accolade was “not in a position to continue further discussions at this time”.
It was reported that 511 grape growers in the Riverland had one day earlier rejected a push to overhaul Accolade’s largest grape supply contract.
Australian Vintage first entered a trading halt last Thursday, pending the release of a company update.
The ASX on Monday granted a suspension from quotation at the request of the company, which said in a statement that it was not in a position to make the announcement.
The statement said “Australian Vintage believes commencing trading would be materially prejudicial to its ability to source additional capital which is critical to support its continued financial viability and operations”.
