- Digital Wine Ventures (DW8) agrees to purchase logistics provider Parton Wine Group (PWG)
- The purchase is expected to lift WINEDEPOT's total number of cases shipped by 220 per cent and total orders to increase over 150 per cent
- DW8 has successfully received commitments for $7.5 million via a share placement to fund the acquisition and support growth
- The company also announced it officially opened to trade buyers located in Melbourne
- On the market this morning, DW8 was down 7.69 per cent and trading at 8.4 cents per share
Digital Wine Ventures (DW8) have agreed to purchase logistics provider Parton Wine Group (PWG).
PWG have grown over the last 14 years to become one of Australia's largest specialist wine and beverage logistics providers.
The purchase is expected to lift key WINEDEPOT's key performance markets, with total number of cases shipped expected to increase 220 per cent to around 87,000 per month.
Total orders are also expected to increase over 150 per cent to around 30,000 per month.
DW8 also said the purchase will provide growth to its online technology wine and beverage distribution platform.
As part of the acquisition, PWG Founder, Richard Raddon, will join WINEDEPOT's senior executive team as general manager of the logistics division.
Mr Raddon's son David, will also join the team as National Operations Manager.
CEO Dean Taylor believes Paton Wine Distribution will greatly enhance WINEDEPOT.
"The challenge is, that up until now, we have relied heavily on 3rd party warehousing and freight providers to support our national logistics network. This model worked reasonably well in serving our customers, but as our business continues to scale, we need more control over how our supply chain is operated. Particularly during peak periods when 3rd party networks can become slow and congested," Mr Taylor said.
"Having our own dedicated fleet of delivery vans and drivers will ensure we provide an exceptional experience for trade buyers using market our recently launched direct-to-trade online marketplace."
DW8 has successfully received commitments for $7.5 million via a share placement to fund the acquisition and support growth.
The share placement will include over 113 million shares for 6.5 cents per share, a 28.6 per cent discount to the last traded share price.
Blue Ocean Equities have been appointed to act as lead manager to the share placement.
WINEDEPOT expands to Melbourne
The company also announced it officially opened to trade buyers located in Melbourne.
Melbourne is the second capital city that WINEDEPOT market has been rolled out in after the platform went live in Sydney in late May.
"The evolution of the wine distribution model in Australia is long overdue. Technology has brought vast changes in the way we produce wine and sell to consumers, but in the middle, supply chains and wholesaling are still plagued by inefficiency," Mr Taylor said.
"The chance to move more of their wine purchasing to a single platform, with a single invoice and single credit account, has been highly attractive to venues and retailers."
On the market this morning, DW8 was down 7.69 per cent and trading at 8.4 cents per share at 11:04 am AEST.