agreed. the fact the quarterly didn't drop before the...

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jbau

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27/10/21

14:02

Post #: 57114043
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Originally posted by steve10: ↑

Yes could have been handled much better.

They would have had all the figures by the time they announced Kaddy on 15/10. SP was up from 5.5c to 6.6c when they made the announcement.

They would have been aware that the acquisition would be finalized. If they released the 4C prior to Kaddy announcement SP would have run to 10c+ therefore a higher CR price & less dilution. Instead they have done it backwards resulting in additional dilution.

Weird because DW8 had to pay x38 revenue multiple to acquire Kaddy but it appears Kaddy didn't want to be acquired at 9.2c SP with DW8 trading at x38 multiple. They wanted their cake & to eat it too. They got it delivered on a gold DW8 platter along with a fine wine.

It's all set up now for Kaddy founders/employees/shareholders to double dip. 5.6c SP shares that will most likely double now after the 4C is released. In leau of 9.2c+ shares & waiting until next 4C.

Kaddy needed cash as growing nationally hence the $5M going towards Kaddy from the CR. They have been affected by lockdowns whereas DW8 performs well in lockdowns. IPO would have valued them at about $900k x 14 = $12.6M & they would have to disclose financials as well as lodge a prospectus.

And current DW8 holders will go from a full strength beer to a mid after waiting since April for SP to recover. Heaps of announcements on the run up to SP peak & then went all quite on the way down, even stopped monthly updates without prior notice mid way through a quarter which is not very good.

The three founders of Winedepot & Kaddy ending up with similar shares is the only reason I can think of why the deal was done now at the price.

In the webinar DT mentioned they all previously met in 2019.

I am all for the Kaddy acquisition but the way it was all executed is a bit fishy.

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agreed. the fact the quarterly didn't drop before the announcement for me is the one that doesn't make sense.

ie, if we are doing a CR then you want to drive the best SP for less dilution.

was kaddy worth $38m - yep i have no issues with the price tag. the platform, SaaS model, growth, team and target market would have seen it fetch this in the open market quite easily imo.

and the value to us / dw8, when we bolt on our existing winery suppliers, logistics, financing and remove a key competitor, i think is in line with the 1+1=3.

I'm happy with the acquisition, but not overly happy we raised at below fair value with a pending 4c, which like you said gives Kaddy shareholders the double dip.

DW8 Price at posting: 5.6¢ Sentiment: Buy Disclosure: Held
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