Mighty Craft to be taken over by senior debt lender Pure

Last week, Mighty Craft Limited creditors voted that the drinks group be taken over by senior debt-lender Pure Asset Management. The news, which was revealed in an announcement made by the appointed administrators, follows on from Mighty Craft's halt in share trading and start of voluntary administration on 22 July.

Also occurring last week, the ASX revealed that Mighty Craft Limited had been removed from its official listing after failing to pay its annual fee payment. 

Approved by creditors, the proposed DOCA is being led by Quentin Olde and Liam Healey of Ankura Consulting. In a joint statement published to the ASX, the pair said, "the second meeting of creditors of the Company was held on Monday… At that meeting, creditors of the Company resolved that the Company execute a Deed of Company Arrangement (DOCA) proposed by Pure Asset Management.”  

Existing creditors are expected to experience major losses as a result of this arrangement. According to the Olde and Healey, the DOCA “proposes a compromise of the liabilities of the Company to its creditors” and “includes a condition precedent that requires all of the issued share capital in the Company be transferred by the Administrators (in their capacity as Administrators of the DOCA) to the Proponent, for a nil consideration to the existing shareholders.”

Additionally, in this article published by the Australian Financial Review, Ankura is quoted to have told creditors they were “currently estimated to receive between 0.5¢ in the dollar to 0.9¢ in the dollar.” 

James Gerraty, Head of Listings Compliance at the ASX, has also announced that Mighty Craft Limited would be officially removed from the Australian Stock Exchange after it failed to pay its annual listing fees for the upcoming year to 30 June 2025: “The following entities did not pay to ASX Limited their annual listing fees in respect of the year ending 30 June 2025 and consequently have been removed from the official list,” said Gerraty.

Mighty Craft first halted share trading on 22 July after an extended period of turbulent trading. During this period, Pure Asset Management worked closely with the debt-riddle drinks group to try to bolster its economic viability. This included eyeing off a potential merger deal with its strongest performing asset, Better Beer.

The Ankura administrators expressed their intention to apply to either the Supreme Court of New South Wales in Sydney or the Federal Court of Australia in Sydney to ask the Court’s permission to implement the DOCA. Given that the new DOCA must be executed within 15 business days of the second meeting of creditors, more information will be made available by the 13 of September. 

“The Administrators are working to finalise the DOCA and related ancillary transaction documents,” continued Olde and Healey. 

“Further announcements to shareholders and other stakeholders in relation to this Court application will be provided in due.”