Bespoke Capital Acquisition Corp. (NASDAQ: BSPE) (TSX: BC.U) (TSX:
BC.WT.U) (“BCAC”) will hold a virtual shareholder meeting to vote
on the proposed combination with Vintage Wine Estates ("VWE") on
Friday May 28, 2021 at 9:00 a.m. (Eastern time).
BCAC Shareholder Meeting on May 28, 2021
The two important resolutions that were adjourned from the May
6th meeting have been put forward for BCAC shareholders to approve
at the upcoming May 28th shareholder meeting:
1) Approval
of the merger with
VWE. 2) Approval
of the domestication of BCAC from British Columbia to Nevada.
Any votes cast with regard to these resolutions prior to or at
the May 6th meeting will NOT be counted towards the final
tally.
Accordingly, BCAC shareholders voting by proxy will be
required to vote the new BLUE proxy card to approve the merger and
the domestication. Your vote will not be counted unless you return
a BLUE proxy card on or prior to May 26, 2021.
The BCAC Board of Directors urges
shareholders of record as of March 31, 2021, the record date for
the meeting, to vote FOR each of the resolutions.
Closing of BCAC’s business combination with VWE is expected to
occur on or about June 7, 2021.
BCAC’s Reasons for the Recommendation
The BCAC Board of Directors believes that the proposed
combination with VWE presents a compelling investment opportunity.
In reaching its recommendation that BCAC shareholders vote in favor
of the resolutions, the BCAC Board of Directors considered a number
of factors, including:
- Industry Tailwinds – The wine industry in
which VWE operates is very large, fragmented and enduring, with a
growing addressable market of over $50 billion in the United States
alone.
- Strong Management – The VWE management team
has a focused approach to cost control, strong innovation
capabilities, a powerful and diversified distribution capability,
strong sales and marketing, and a high-quality portfolio of
brands.
- Remarkable Historical Growth and Prospects for Future
Financial Performance – VWE’s net revenue CAGR and
Adjusted EBITDA CAGR have each exceeded 20% since 2010. This
success has been driven by a combination of organic growth, new
product innovation and over 20 successfully integrated
acquisitions.
- M&A Strategy – VWE has historically been a
consistent, serial consolidator. VWE has successfully acquired 20
wineries in the past 10 years and believes that U.S. wine industry
conditions are increasingly positive for synergistic
acquisitions.
- Valuation – BCAC believes that the transaction
is very attractively valued for shareholders at 11.9x EV/Adjusted
EBITDA FY22 of $63 million and FY22 P/E of 20.6x (including
acquisitions) and that the transaction represents a discount to
comparable listed companies.
VWE Completes Acquisition of Kunde and Reaffirms
Earnings Guidance for FY21
VWE continues to execute on its business strategy. VWE has
successfully completed the acquisition of Kunde, a winery business
consistently recognized as one of the top ten brands in Sonoma and
best known for its Cabernet Sauvignon, Merlot, Chardonnay and
Zinfandel. Kunde’s financial results to be consolidated into VWE
financials from April 19 onwards.
Based on the continued execution of the VWE business strategy,
and the successful closing of the Kunde acquisition, the company
has reaffirmed the earnings guidance provided in BCAC’s investor
presentation (dated April 23, 2021) of Pro Forma Adjusted EBITDA of
$46m and net revenue of $220m for FY21.
The company will release its Q3 quarterly financials in a
Current Report on Form 8-K to be filed in connection with the
completion of the business combination, which is currently expected
to be filed on or prior to June 11, 2021.
Redemption Rights
Holders of Class A Restricted Voting Shares of BCAC have a right
to redeem their shares prior to 4:00 p.m. (EDT) on June 4, 2021 in
connection with the business combination. BCAC estimates that each
Class A Restricted Voting Share so redeemed will be redeemed for
approximately $10.10. The redemption amount is expected to be paid
following the domestication to Nevada.
In connection with the previous redemption right, a number of
BCAC shareholders elected to reverse their decision to redeem
before the May 14, 2021 deadline. This resulted in 10,324,596
shares being redeemed in connection with the vote to extend the
permitted timeline for the qualifying acquisition which reflected a
reduction of 2,849,051 shares.
Forward-Looking Statements
Some of the statements contained in this
document are forward-looking statements within the meaning of U.S.
securities laws and forward-looking information within the meaning
of applicable Canadian securities laws (collectively,
“forward-looking statements”). Forward-looking statements are all
statements other than those of historical fact, and generally may
be identified by the use of words such as “anticipate,” “believe,”
“continue,” “estimate,” “expect,” “future,” “intend,” “may,”
“model,” “outlook,” “plan,” “pro forma,” “project,” “seek,”
“should,” “will,” “would” or other similar expressions that
indicate future events or trends. These forward-looking statements
include, but are not limited to, statements regarding closing of
the investment and the transaction, the shareholder meeting and its
business, estimates and forecasts of financial and performance
metrics, projections of market opportunity and market share,
business plans and strategies, expansion and acquisition
opportunities, growth prospects and consumer and industry trends.
These statements are based on various assumptions, whether or not
identified in this press release, and on the current expectations
of BCAC’s management and are not guarantees of actual performance.
These forward-looking statements are provided for illustrative
purposes only and are not intended to serve as, and must not be
relied on by any investor as, a guarantee, assurance or definitive
statement of fact or probability. Actual events and circumstances
are difficult or impossible to predict and may differ materially
from those contained in or implied by such forward-looking
statements. These forward-looking statements are subject to a
number of risks and uncertainties, many of which are beyond the
control of BCAC. Factors that could cause actual results to differ
materially from the results expressed or implied by such
forward-looking statements include, among others: the effect of
economic conditions on the industries and markets in which VWE
operates, including financial market conditions, fluctuations in
prices, interest rates and market demand; the ability of the
parties to successfully or timely consummate the transactions,
including the risk that any required regulatory approvals are not
obtained, are delayed or are subject to unanticipated conditions
that could adversely affect the combined company or the expected
benefits of the transactions or that the approval of the
shareholders of BCAC or VWE is not obtained; failure to realize the
anticipated benefits of the transactions; risks relating to the
uncertainty of the projected financial information; the effects of
competition on VWE’s future business; risks related to the organic
and inorganic growth of VWE’s business and the timing of expected
business milestones; the amount of redemptions, if any, made by
BCAC’s shareholders in connection with the transactions; the
requirement for Wasatch to fund the subscription price on closing;
the potential adverse effects of the ongoing COVID-19 pandemic on
VWE’s business and the U.S. economy; declines or unanticipated
changes in consumer demand for VWE’s products; the impact of
environmental catastrophe, natural disasters, disease, pests,
weather conditions and inadequate water supply on VWE’s business;
VWE’s significant reliance on its distribution channels; potential
reputational harm to VWE’s brands from internal and external
sources; possible decreases in VWE’s wine quality ratings; possible
departures from VWE’s or the combined company’s senior management
team; integration risks associated with acquisitions; changes in
applicable laws and regulations and the significant expense to VWE
of operating in a highly regulated industry; VWE’s and the combined
company’s ability to make payments on its indebtedness; and those
factors discussed in documents of BCAC filed, or to be filed, with
the U.S. Securities and Exchange Commission (“SEC”) or Canadian
securities regulatory authorities. There may be additional risks
that BCAC does not know or that BCAC currently believes are
immaterial that could also cause actual results to differ from
those expressed in or implied by these forward-looking statements.
In addition, forward-looking statements reflect BCAC’s
expectations, plans or forecasts of future events and views as of
the date of this press release. BCAC undertakes no obligation to
update or revise any forward-looking statements contained herein,
except as may be required by law. Accordingly, undue reliance
should not be placed upon these forward-looking statements.
Use of Projections
The projections, estimates and targets in this
press release are forward-looking statements that are based on
assumptions that are inherently subject to significant
uncertainties and contingencies, many of which are beyond VWE’s and
BCAC’s control. List of assumptions is set out in the Consent
Solicitation Statement/Prospectus and the Canadian Prospectus (as
defined below). VWE’s and BCAC’s independent auditors did not
audit, review, compile or perform any procedures with respect to
such projections, estimates or targets for the purpose of their
inclusion in this presentation, and accordingly, such auditors
neither expressed an opinion nor provided any other form of
assurance with respect thereto for the purpose of this press
release. While all projections, estimates and targets are
necessarily speculative, VWE believes that the preparation of
prospective financial information involves increasingly higher
levels of uncertainty the further out the projection, estimate or
target extends from the date of preparation. The assumptions and
estimates underlying projected, expected or target results are
inherently uncertain and are subject to a wide variety of risks and
uncertainties, including but not limited to those mentioned above,
that could cause actual results to differ materially from those
contained in such projections, estimates and targets. The inclusion
of projections, estimates and targets in this document should not
be regarded as an indication that VWE, BCAC or their respective
representatives considered or consider such financial projections,
estimates or targets to be a reliable prediction of future
events.
See “Forward-Looking Statements” above.
Non-GAAP Financial Measures
VWE uses Adjusted EBITDA to supplement measures of
performance under United States generally accepted accounting
principles (“GAAP”) to evaluate the effectiveness of its business
strategies. These metrics are also frequently used by analysts,
investors and other interested parties to evaluate companies in
VWE’s industry, when considered alongside other GAAP measures.
Adjusted EBITDA is defined as earnings before interest, income
taxes, depreciation and amortization, stock-based compensation
expense, casualty losses or gains, impairment losses, changes in
the fair value of derivatives, restructuring related income or
expenses, acquisition and integration costs, and certain non-cash,
nonrecurring, or other items that are included in net income that
VWE does not consider indicative of its ongoing operating
performance, including COVID-related adjustments.
The financial information and data contained in
this press release is unaudited and does not conform to Regulation
S-X. All VWE and combined company projected financial information
included herein is preliminary and subject to risks and
uncertainties. Any variation between VWE’s or the combined
company’s actual results and the projected financial information
included herein may be material. Some of the financial information
and data contained in this presentation, such as EBITDA and
Adjusted EBITDA have not been prepared in accordance with GAAP.
BCAC and VWE believe that the use of these non-GAAP financial
measures provides an additional tool for investors to use in
evaluating historical or projected operating results and trends in
and in comparing VWE’s financial measures with other similar
companies, many of which may present similar non-GAAP financial
measures to investors. Management does not consider these non-GAAP
measures in isolation or as an alternative to financial measures
determined in accordance with GAAP. The principal limitation of
these non-GAAP financial measures is that they reflect the exercise
of judgments by management about which expense and revenue items
are excluded or included in determining these non-GAAP financial
measures. In order to compensate for these limitations, management
presents historical non-GAAP financial measures in connection with
GAAP results. A reconciliation of these non-GAAP financial measures
is included in the Consent Solicitation Statement/Prospectus and
the Canadian Prospectus. Not all of the information necessary for a
quantitative reconciliation of the forward-looking non-GAAP
financial measures to the most directly comparable GAAP financial
measures is available without unreasonable efforts at this
time.
Important Information and Where to Find It
In connection with the transactions, BCAC has
filed (1) with the SEC a consent solicitation statement/prospectus
(the “Consent Solicitation Statement/Prospectus”), which includes a
consent solicitation statement of VWE and a prospectus of BCAC
disseminated to BCAC shareholders and VWE shareholders; (2) with
Canadian securities regulatory authorities a non-offering
prospectus (the “Canadian Prospectus”) under Canadian securities
laws disseminated to BCAC shareholders; and (3) with Canadian
securities regulatory authorities a management proxy circular (the
“Proxy Circular”) under Canadian securities laws disseminated to
BCAC shareholders. INVESTORS AND OTHER SECURITY HOLDERS ARE URGED
TO READ THE CONSENT SOLICITATION STATEMENT/PROSPECTUS, THE CANADIAN
PROSPECTUS AND THE PROXY CIRCULAR, ANY AMENDMENTS THERETO AND ANY
OTHER DOCUMENTS FILED BY BCAC WITH THE SEC OR CANADIAN SECURITIES
REGULATORY AUTHORITIES CAREFULLY AND IN THEIR ENTIRETY BECAUSE THEY
CONTAIN IMPORTANT INFORMATION ABOUT BCAC, VWE AND THE TRANSACTIONS.
Investors and security holders may obtain free copies of these
documents and other documents, with respect to those filed with the
SEC, at www.sec.gov, and with respect to those filed with the
Canadian securities regulatory authorities, at www.sedar.com, or by
directing a request to BCAC at 595 Burrard Street, Suite 2600,
Three Bentall Centre, Vancouver, BC V7X1L3.
INVESTMENT IN ANY SECURITIES DESCRIBED HEREIN
HAS NOT BEEN APPROVED OR DISAPPROVED BY THE SEC, CANADIAN
SECURITIES REGULATORY AUTHORITIES OR ANY OTHER REGULATORY AUTHORITY
NOR HAS ANY AUTHORITY PASSED UPON OR ENDORSED THE MERITS OF THE
OFFERING THEREOF OR THE ACCURACY OR ADEQUACY OF THE INFORMATION
CONTAINED HEREIN. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
Participants in the Solicitation
BCAC and VWE and their respective directors and
certain of their respective executive officers and other members of
management and employees may be considered participants in the
solicitation of proxies or consents with respect to the
transactions. Information about the directors and executive
officers of BCAC and VWE and a description of their direct and
indirect interests, by security holdings or otherwise, are set
forth in the Consent Solicitation Statement/Prospectus, the
Canadian Prospectus and the Proxy Circular. Additional information
may be set forth in other relevant materials to be filed with the
SEC and Canadian securities regulatory authorities regarding the
transactions. Security holders, potential investors and other
interested persons should read these materials carefully and in
their entirety when they become available before making any voting
or investment decisions. You may obtain free copies of these
documents as indicated above.
No Offer or Solicitation
This document shall not constitute an offer to
sell or the solicitation of an offer to buy any securities, nor
shall there be any offer or sale of securities in any jurisdiction
where such offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any such
jurisdiction. No offering of securities will be made except by
means of a prospectus meeting the requirements of the Securities
Act of 1933 or an exemption therefrom.
Contacts:
Investors
Mark HarmsBespoke Capital Partners
LLCinformation@bespokecp.com +44-207-016-8050
or
ICRBespokeIR@icrinc.com
Media
Alecia PulmanBespokePR@icrinc.com
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