Global financial adviser Deloitte is seeking expressions of interest for the sale of a controlling share in Vale Brewing, the McLaren Vale, South Australia company.
Vale is being represented by David Egan, a partner in Deloitte’s mergers and acquisitions advisory practice in Adelaide.
“The shareholders are open to exploring a range of possible deal structures (including the current owners retaining an ownership interest in the business),” says an investment brochure seen by Brews News.
Vale’s identity is not explicitly revealed in the document, which refers to the investment opportunity under the pseudonym of ‘Project Galaxy’.
“Having operated for c.10 years, Galaxy is well-established and has cemented its presence in Australia’s booming craft beer industry,” it says.
“Galaxy’s flagship brand is one of the most recognisable independent craft beer brands in Australia.”
That flagship is likely top seller Vale Ale, which in 2010 topped the GABS Hottest 100 poll, making it the last beer to achieve this honour prior to the six-year shared dynasty of Stone & Wood Pacific Ale and Feral Hop Hog.
Reluctant sale by family
Vale became family-owned in 2015 when the Collin brothers bought out the other shareholders in the business.
Director Tim Collin told Brews News on Tuesday that the reluctant sale is due to a change in family circumstances.
“My younger brother spent 2016 battling a brain tumour and as a result of that he is no longer allowed to drink alcohol for the rest of his life, which has severely taken the shine off owning a craft brewery,” he said.
“We are very proud of the products and the business that we have been able to build and we are very keen to see it continue to develop long into the future, but our position as a family owner group has changed and this has led to the decision to seek a partial or full exit from the business.”
Improved margin mix
Vale last year launched Fox Hat Brewing, a separate label for more challenging and experimental beers.
Collin said that while the company has lost some volume overall in recent years, improvements to its margin mix have kept its bottom line in good stead.
According to Deloitte, the company has a successful export business, with an established presence in several international markets for more than four years.
Collin confirmed that former CEO Stuart Mosman left the company in April, having joined early in 2016.
Mosman has been replaced by Vale’s longstanding head brewer Jeff Wright, who now holds the CEO role in a dual capacity.