On behalf of the Board, it is my pleasure to offer you the opportunity to become
a Shareholder of Top Shelf International Holdings Ltd (Top Shelf or the Company).
Established in 2015, Top Shelf is an Australian diversified branded spirits company
with a core purpose to promote, celebrate and enjoy our distinctive Aussie way of
life by being “Daring, Strong and proudly Australian”. As only approximately 8% of
bottles spirits sold in Australia in 2019 were Australian by provenance,1
there is a significant opportunity to leverage “Brand Australia” both domestically and
globally. The Australian wine industry has demonstrated what is possible in building
a global presence and we believe the same opportunity exists for “scaled craft”
Australian spirit brands.
Our ambition is to create high quality, authentic Aussie spirit brands where each
brand in its own distinctive way embodies an unmistakably Aussie taste, attitude
and social experience. This ambition is backed by our established platform, with
over $35 million of capital invested to date in the build out of our supply chain and
brands. We have built one of the largest capabilities to source and distil spirits in
Australia. The scale of the Company’s operations and vertically integrated production
capability mean that Top Shelf is well placed to compete in our chosen markets.
Our current portfolio of brands include the NED brand of Australian bottled whisky
and whisky based RTD products and the Grainshaker brand of Australian bottled
vodka. As we focus on scaling NED and Grainshaker, we are also looking forward to
our future pipeline of brand and product development. The key product we expect
to launch in the near term is a unique agave spirit of Australian provenance.
In support of Top Shelf’s ambition to develop an agave spirit product, over 120,000
agave tequilana plants have been planted at the Eden Lassie agave farm in Queensland2
and over 100,000 additional plants are in nurseries. Tequila and mezcal spirits are
produced using agave plants and consumption of these spirits in the USA has grown
at a 7.5% CAGR from 2014 to 2019.3
Top Shelf considers a unique agave spirit of
Australian provenance to be an attractive opportunity.
The ability to execute our ambition is underpinned by 6 core pillars:
1. Attractive market fundamentals – large addressable spirits markets with
attractive competitive characteristics and consumer trends;
2. Repeatable multi-brand platform – proven capability to develop, launch and
scale authentic Australian spirit brands;
3. Installed scalable capacity – scalable production assets supported by
a vertically integrated, sustainable supply chain to underpin growth;
4. Strong track record of growth – material historic revenue growth achieved with
significant revenue growth of 160% to approximately $20.0 million forecast from
FY20 to FY21;
5. Multiple growth frontiers – multiple active growth verticals to drive strong
revenue growth, supported in the near term by focused national distribution
relationships, maturation asset base and capability to provide third party
packaging services; and
6. Innovation and execution engine – highly credentialed, entrepreneurial and
values based leadership team driving execution and innovation.
A Daring Australian Spirit reflects our ethos. We are a committed, entrepreneurial
team who share a common ethos of being daring, trailblazing, spirited, peerless,
and grounded. This is reflected in our approach to innovation and development,
and dealings with all stakeholders, as personified in our organisational values
and commitment to research and development.
The Offer is expected to raise $47.2 million based on the Offer Price of $2.21 per Share
(and $1.88 per Share under the Priority Offer). This comprises $35 million for the
issue of New Shares (the proceeds of which will be received by the Company) and
$12.2 million for the sale of Sale Shares by SaleCo (the proceeds of which will be
received by the Selling Shareholders). Funds raised by Top Shelf under the Offer
will be used to provide further brand and marketing investment to support brand
revenue growth, inventory investment both in liquid and container assets, fixed asset
investment, including the completion of the Eden Lassie agave farm acquisition,
provide balance sheet flexibility and pay down debt.
This Prospectus contains detailed information about the Offer, the market Top Shelf
operates within, Top Shelf’s operating and financial performance and details of some
of the key risks associated with an investment in the Company. These key risks are
set out in Section 5.
It is important you read this Prospectus carefully, including the key risks set out in
Section 5, before deciding whether to invest in Top Shelf.
On behalf of the Board, I look forward to welcoming you as a Shareholder.