RE: SP7 Jan 2022 15:49
But DIS does not need to wait for the distillery to be built before it gets something back ….
Immediate and longer-term benefits for the Company through the Investment, including distilling, new product development and small batch bottling capability, a physical 'home' for the Company's Blackwoods and TRØVE brands and access to Ardgowan's Master Distiller, the renowned Max Macfarlane, to help produce an own brand malt whisky for the Company.
The investment will provide a yield of 5% which, once the Loan is fully drawn down, will amount to an annualised income of £250,000 (an annualised £150,000 until that point).
Furthermore, the Company will obtain security over 10% of Ardgowan's annual production of malt whisky (or other product at the discretion of Distil), and gives Distil the option at any time, following a period of consultation, to convert this investment into approximately a 14.28% stake in Ardgowan (assuming the loan outstanding is £5 million). The nature of the Investment will provide Distil with commercial and operational benefits for its existing business (see below) as well as this potential opportunity to acquire an equity stake in the business.
Within the Manufacturing Agreement (see below) Ardgowan will assist, through their Whisky Distiller, the sourcing and crafting of blended malts purchased in cask from third party distilleries. These whiskies will be branded, owned and marketed by Distil and sold through the Company's own distribution network. Malt whisky is an attractive high value, high margin, high growth category. Opportunities for the joint development of future malt whisky products will be explored enabling Distil to further broaden its brand portfolio once Ardgowan whisky stock has sufficiently aged (minimum of three years). Distil expects to launch a range of Distil branded premium malt whiskies in 2021/22.
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