Mighty Craft Limited announces sale of Mismatch and 78 Degrees assets

Mighty Craft Limited (ASX: $MCL) has entered into an agreement to sell the assets associated with Mismatch Brewing Company Pty Ltd and The Hills Distillery Pty Ltd to a third party buyer led by a consortium of experienced publicans in the Australian hospitality industry. The sale includes the brands, intellectual property, trading names, contracting arrangements, inventory, plant and equipment, and licences for a cash consideration of not less than $7.2 million, plus GST if applicable. 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. Approximately half of the proceeds 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 parties are targeting a settlement on or prior to 31 May 2024.

Executive Commentary on the Sale of Mismatch and 78 Degrees Assets

The sale of the assets associated with Mismatch and 78 Degrees marks a strategic decision for Mighty Craft Limited. This transaction allows us to streamline our operations and focus on our core business activities. The cash consideration from the sale will enable us to partially repay our outstanding debt facilities and provide funding for the ongoing operations of the business. We believe that the consortium of experienced publicans will continue to uphold the legacy of Mismatch and 78 Degrees, ensuring the brands' continued success in the Australian hospitality industry.

Summary of Mighty Craft's Asset Sale and Future Outlook

Mighty Craft Limited (ASX: $MCL) has successfully entered into an agreement to sell the assets associated with Mismatch Brewing Company Pty Ltd and The Hills Distillery Pty Ltd to a consortium of experienced publicans in the Australian hospitality industry for a cash consideration of not less than $7.2 million. The sale is expected to streamline operations, with approximately half of the proceeds allocated to debt repayment and the remaining half to fund ongoing business activities. The company aims to target a settlement on or prior to 31 May 2024. This strategic move aligns with Mighty Craft's focus on enhancing its core business activities and optimizing its financial position for future growth and development.