FTI says Nant is still a ‘complex situation’

02 June, 2017 by TheShout

By Andy Young

FTI Consulting, the receivers appointed by Eclipx Commercial Pty Ltd to deal with the Nant Distillery, have told TheShout that this is one of the most complex situations they have been involved with.

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FTI Consulting are working towards their court date of 3 July which will look at the ongoing dispute between Nant and Australian Whisky Holdings (AWH), which has been running since October last year when AWH first entered into an agreement to buy the Nant Distillery business and the Nant Estate

One of the main areas of concern in the whole situation has been regarding the Barrel Investment Scheme which was being run by the Nant Distillery. In March this year, AWH said that it had discovered “a number of serious anomalies and some minor ones” regarding the barrels which were meant to be filled as part of the scheme. 

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AWH said these anomalies included barrels that were not filled, some which had already been decanted and others filled with low ABV spirit.

In his letter Malcolm said that AWH was making an offer “to commit to purchase your barrel back on maturity”, adding, “we are making this offer to selected barrel investors as a result of concerns arising from the recent insolvency of several companies in the Nant group of companies, formerly managed by Keith Batt and Margaret Batt”.

Malcolm wrote to investors: “All identified investor barrels are held in our regulated heritage bond stores at Nant Estate in Bothwell, Tasmania. They are secure under lock and key with staff living on site. Access to the bond stores is strictly controlled. 

“The barrels have been insured and they are being managed and regularly monitored by our distillers. Through regular expert monitoring of the barrels we are able to identify when the whisky reaches maturity, so that we can judge the optimal time to decant the whisky in order to maximise its value and quality.”

He also said: “FTI Consulting – receivers appointed by Eclipx Commercial (a private financier) to another Batt company, Nant Distillery Pty Ltd (now known as NAW Distillery Pty Ltd) – have attempted to seize investor barrels and distillery equipment.”

However, Quentin Olde, Senior Managing Director, FTI Consulting, told TheShout that those claims are not true.

“This is one of the most complex situations I have been involved in. There’s a high degree of uncertainty about the status of some of the assets,” Olde said.

“Claims that FTI has tried to ‘seize investor barrels and distillery equipment’ are just plain wrong – our role as receiver is to represent the interests of secured and other creditors, and that is what we’re trying to do.”

With court proceedings set for next month, Olde called on AWH to work with a court appointed receiver to help clarify the situation regarding the barrels in the scheme and to work with FTI Consulting to clarify the whole situation.

Olde added: “If AWH are serious about protecting the interests of the barrel investors, they’d open the books, allow access to the assets, and work with us to untangle this complex corporate web.

"The whisky in the barrels was distilled by Nant and can only be sold that way, or under a different brand. If they rebrand, advice from industry experts suggests there will be a significant downwards shift on price of the premium product – which is not in the interests of barrel investors.

“The latest offer from AWH to barrel investors is also not in the best interests of investors – offering to buy back barrels at maturity at a price based on an undisclosed formula, while at the same time pressuring investors to sign onto the deal within seven days is concerning.

“At the moment, AWH are essentially asking barrel investors to trust them – there’s no independent oversight or audit of the barrels and whisky at Bothwell. 

“We’ve said all along that the best thing now for barrel investors and other creditors is for a receiver to be appointed by the Federal Court. It’s a shame AWH continue to frustrate that process.”

TheShout has contacted AWH for comment.

 

 

 

 

 

 

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