Vintage Wine Estates files for bankruptcy

Vintage Wine Estates filed a voluntary petition for reorganization under chapter 11 of title 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware. Over the preceding months, the company experienced negative financial headwinds that severely impacted its liquidity position. The debtors have filed a motion seeking approval of the marketing auction and sale of the company’s assets. The company, as borrower, intends to enter into a debtor-in-possession financing facility pursuant to which the lenders will make available to the company a credit facility in the amount of $60.5M. The DIP Facility will be used to support the company’s business during the restructuring process. The Chapter 11 filing constitutes an event of default that accelerated the company’s obligations under the Loan and Security Agreement with BMO Bank. As of the petition date, the company had an aggregate of approximately $310M in outstanding loans and commitments. The company expects commercial operations to continue largely business-as-usual. The company also announced its intention to voluntarily delist its common stock and warrants from Nasdaq and deregister its common stock and warrants. The company has notified Nasdaq of its intent to voluntarily delist its common stock and warrants, and intends to file a notice on Form 25 relating to such delisting with the SEC on or about August 5. The company expects the delisting of the common stock and warrants to be effective on or about August 15 and intends to file a Certification and Notice of Termination of Registration with the SEC on or about August 15. Following delisting, the common stock and warrants may be eligible to be quoted on the Pink Open Market operated by the OTC Markets Group. The company is currently evaluating multiple preliminary indications of interest with respect to the potential sale of various of its assets. The company also completed the sale of Cosentino Winery’s real property and equipment for cash proceeds of $10.5M that were used to pay down debt.