SHARES in Buronga Hill Winery owner Australian Vintage resumed trading this week after they were suspended last month.
A statement from the company, which owns the McGuigan, Tempus Two, Nepenthe and Passion Pop brands, said it would be able to raise $15 million from investors as it returned to trade on Thursday.
Combined with a debt refinancing, the company expected to raise at least $45 million overall.
After merger talks with Accolade Wines were halted in May, ending three months of negotiations, Australian Vintage went into a three-week suspension to address funding issues.
But despite the finance lifeline from investors, the market capitalisation of Australian Vintage had almost halved since the suspension.
Acting chief executive Peter Perrin said the current cycle was “one of the most challenging on record for the Australian wine industry”, and that was reflected in their financial performance.
“In the face of these sectorial headwinds, we are growing market share in our key markets, introducing considered innovations and improving our underlying earning performance,” he said.
“While there are encouraging signs that the oversupply of red grape varietals is easing, consistent with prior cycles, we expect the market will take time to rebalance, and trading conditions are likely to remain challenging in the interim.”
Mr Perrin said the capital-raising moves would enable to business to better navigate volatile conditions and capitalise on future opportunities, including “potential consolidation”.
