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Source: Top Shelf International
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  • Top Shelf International (TSI) taps institutions and mum and dad investors for $35 million to build an integrated agave spirit production facility
  • The company plans to raise the funds through a share placement and an entitlement offer, with all new shares to be offered at $1.60 each
  • On top of the agave spirit facility, the funds will go towards scaling up Top Shelf’s NED Whisky and Grainshaker Vodka brands and building new digital tech
  • Top Shelf ended the September quarter with just over $4.5 million in the bank after posting a net quarterly cashflow-negative result of $3.65 million
  • Shares in Top Shelf last traded for $1.82 each on Tuesday, October 19

ASX-listed spirit maker Top Shelf International (TSI) is tapping institutions and mum and dad investors for $35 million to build an integrated agave spirit production facility.

The company this morning called a two-day trading halt as it gears up to launch the cap raise, which it plans to complete through a share placement and an entitlement offer.

All new shares to be issued under the raise will be offered at $1.60 each — a 12.1 per cent discount to TSI’s last closing price of $1.82 per share.

On top of the agave spirit facility, some of the funds from the capital raise will go towards scaling up Top Shelf’s NED Whisky and Grainshaker Vodka brands, building new digital tech, and optimising the company’s supply chain.

Both the placement and the entitlement offer are fully underwritten by Shaw and Partners and Canaccord.

The placement and entitlement offer

The share placement is slated to settle on Wednesday, October 27, and will only be open to institutions.

Top Shelf plans to issue 5.8 million shares under the placement to raise just under $9.3 million. This segment of the capital raise is not subject to shareholder approval.

In the meantime, the entitlement offer will be split into two parts: an institutional segment and a retail segment.

Under the offer, shareholders will have the chance to purchase one new share for every 3.1 shares owned at the same price as the placement.

The institutional segment of the entitlement offer will be completed before the end of the week, with the retail offer to open on Wednesday, October 27. The retail offer will close on Friday, November 5, with results to be announced on November 9.

Why the raise?

News of today’s capital raise was released in tandem with Top Shelf’s latest financial report, in which the company flagged record quarterly cash receipts of $5.8 million for the first quarter of the 2022 financial year.

CEO Drew Fairchild said the company was “primed for continued, sustainable growth” despite the market disruption associated with COVID-19.

“We have built a highly skilled team, established distribution channels for both NED Whisky and Grainshaker Vodka, completed our service delivery model and implemented our national field sales team,” Mr Fairchild said.

“We will have significantly more whisky available for harvest and sale in the second half of FY22 and will be in a position where we can activate and accelerate the market penetration and velocity of our brands.”

Top Shelf ended the September quarter with just over $4.5 million in the bank after posting a net quarterly cashflow-negative result of $3.65 million.

Shares in Top Shelf last traded for $1.82 each on Tuesday, October 19. The company has a $78 million market cap.

TSI by the numbers
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