Mighty Craft has entered into an agreement to sell Mismatch Brewing Company and The Hills Distillery, which makes 78 Degrees, to the United Publicans Group. The group is made up of around 15 pub groups with over 200 venues and industry experts including ex-CUB CEO Peter Filipovic.

The deal includes the assets associated with Mismatch and 78 Degrees, including the brands and all intellectual property, trading names, contracting arrangements, inventory, plant and equipment, and licences.

In a statement about the sale, Mighty Craft said the above elements would be sold to the buyer, “for cash consideration totalling not less than $7.2m (plus GST, if applicable).”

Adding: “The sale is conditional upon the transfer of all liquor licences, and the parties using reasonable endeavours to recommend certain personnel associated with the businesses accepting offers of employment made by the Buyer.

“The sale also includes the assignment of the leases for the Mismatch Brewhouse venue and the Mismatch and 78 Degrees production facility in South Australia.”

The consortium of buyers includes Filipovic, who told The Shout is extensively a similar group to the one that bought Jetty Road and Hills Cider last year.

Filipovic added: “The group has the intention to have these brands within their outlets as well as grow the brands without.

“It is quite difficult to get into taps in the on-premise and this group enables us to get distribution in over 200 venues, without any kind of business agreement in place.”

He explained that the make-up of venues within the group is at the sophisticated end of the market and in terms of the number of venues, Victoria is first, followed by New South Wales, then Queensland and also some venues in South Australia.

Looking at plans for the brands, Filipovic told The Shout: “The reality is that it’s going to be easier for us to get on-premise distribution, but it doesn’t mean that national accounts and retail are not a focus. It just means that the way we build the brands is going to be focused on each of the brands and their own story.”

Expanding on that, Filipovic said: “We’ve actually inherited some really good brands and with each of the brands we are going to go back to their roots and build them in their local communities, where they became famous to start with.

“We will invest in the brands, and then build the brands through what I would call the brand champions, which are out of the United Publicans Group. Each of the brands has an incredible story and these two brands in particular have good brand equity and our assessment is that they have a good ability to grow, rather than just stagnate.

“Mismatch is a big brand in South Australia, it’s a more prominent brand than I imagined in South Australia and with the group that we have involved we can grow scale and distribution.”

Mighty Craft’s ASX statement about the deal explained how the proceeds of the sale will be used, stating: “It is intended that approximately half of the proceeds of the sale will be paid to MCL’s senior lenders as partial repayment of its outstanding debt facilities and the other half will fund the ongoing operations of the business.”

The timing of sale completion is uncertain, but Mighty Craft said both parties are currently targeting a settlement prior to 31 May 2024.

Andy Young

Andy joined Intermedia as Editor of The Shout in 2015, writing news on a daily basis and also writing features for National Liquor News. Now Managing Editor of both The Shout and Bars and Clubs.

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