Re­nais­sance Brew­ing calls time

Marlborough Express - - NEWS - TOM PULLAR-STRECKER

Marl­bor­ough’s Re­nais­sance Brew­ing, the first Kiwi com­pany to re­ceive eq­uity crowd­fund­ing, has gone into vol­un­tary ad­min­is­tra­tion.

The craft brewer be­came a poster boy for eq­uity crowd­fund­ing when it raised $700,000 from in­vestors in 2014, and its fi­nan­cial dif­fi­cul­ties high­light the risks in­volved.

Eq­uity crowd­fund­ing was de­signed to make it eas­ier for small busi­nesses to raise money from the pub­lic, by al­low­ing them to raise up to $2m from re­tail in­vestors with­out fil­ing a for­mal prospec­tus.

It has since been used by dozens of firms to raise tens of mil­lions of dol­lars of cap­i­tal.

Iain Shep­hard of ad­min­is­tra­tor Shep­hard Dun­can was con­fi­dent Re­nais­sance Brew­ing would be sold as a go­ing con­cern.

‘‘The busi­ness is trad­ing as nor­mal to­day. We are brew­ing and all cus­tomers’ or­ders are get­ting ful­filled.’’

The com­pany’s seven staff had been re­tained, but it was too early to say what the sit­u­a­tion would be for in­vestors, he said.

‘‘We have only been ad­min­is­tra­tors for 24 hours and we are work­ing through the usual process.’’

In a note to in­vestors, Shep­hard Dun­can said the firm had strug­gled to gen­er­ate suf­fi­cient mar­gins on sales and that, cou­pled with re­duced turnover, had placed a ‘‘sig­nif­i­cant strain on cash flow’’.

‘‘The di­rec­tor had sought ad­di­tional fund­ing from the bank and oth­ers, how­ever this was not forth­com­ing.’’

Auck­land pub­lic re­la­tions ex­ec­u­tive Conor Roberts is one of 300 beer lovers who put a ‘‘cou­ple of thou­sand dol­lars’’ into the firm ‘‘for a bit of fun’’ in 2014.

‘‘They brew great beer and they have just put in a new bot­tling line but they have strug­gled a bit I think with dis­tri­bu­tion,’’ he said.

‘‘You don’t see [their beer] in enough places around town and they have had a bunch of per­son­nel changes as well.’’

Re­nais­sance Brew­ing had been pretty good about com­mu­ni­cat­ing with its in­vestors in the past and warned in a quar­terly re­port in Au­gust that it faced a chal­leng­ing trad­ing sit­u­a­tion last year, Roberts said.

While it was dis­ap­point­ing the brewer had gone into ad­min­is­tra­tion, the ex­pe­ri­ence wouldn’t put him off en­gag­ing in eq­uity crowd­fund­ing again, he said.

‘‘There are no ex­am­ples of there be­ing zero risk in the world. You should al­ways go into th­ese things with your eyes open but some­times they will work and some­times they won’t.’’

He had at least got a case of beer each year, in re­turn for his in­vest­ment.

‘‘I’ll be en­joy­ing one this evening – toast­ing some­one else com­ing in and pick­ing [the busi­ness] up.’’

It may be the last free case for the com­pany’s in­vestors for a while. Dun­can Shep­hard said a con­se­quence of the ad­min­is­tra­tion was ‘‘that there will be no dis­tri­bu­tion of beer to share­hold­ers at this time’’.

‘‘They brew great beer and they have just put in a new bot­tling line but they have strug­gled a bit I think with dis­tri­bu­tion.’’ Conor Roberts

PHOTO: SUPPLIED

A week­end of heavy rain re­sulted in eight large slips and many small slips on SH1 south of Kaik­oura, in­clud­ing near the Con­way River and fur­ther south through the Hun­dalees.

PHOTO: SUPPLIED

Staff at Re­nais­sance’s Blen­heim base have been re­tained, and ad­min­is­tra­tor Iain Shep­hard was con­fi­dent the firm would be sold as a go­ing con­cern.

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