By Ian Neubauer
WA’s Empire Beer Group has announced it is yet to find suitable new business opportunities to invest $1.9 million raised through the release of new shares in April and monies earned from the sale of its two pubs in East Perth and Margaret River last year.
The boutique brewer has been seeking a new overall direction since the completion of a strategic review in August 2008 that concluded its former strategy of establishing a multi-venue hospitality operation to distribute its beer products had not been successful.
However, an overly stringent investment criteria established to safeguard the beer group’s new cash reserves has resulted in the rejection of all opportunities pursued by to the board over the past two months.
“The Board’s strong view is that the current difficult economic environment will continue to provide opportunities for well capitalised acquirers. The board has been actively seeking such opportunities both in the industrial and resources sector,” Empire executive director Greg Bandy said in a statement posted on the ASX.
“[But] all opportunities considered must meet certain and strict investment criteria. To this point, despite having conducted due diligence on no less than four businesses, none have managed to do so. We continue to evaluate companies we think are undervalue or present an opportunity to increase shareholder value.”
Bandy added that the board was “very conscious” of managing its cost base while it sought further opportunities as they arise and was “carefully” managing its cash reserves to provide “a meaningful return for shareholders while retaining relatively low risk”.
Empire shares were trading at 5.5 cents at midday today (Jun 15).