Palandri float pace quickens

Palandri Ltd’s planned Australian stock market float appears to be gathering momentum, with industry sources revealing the Margaret River winery has appointed a stockbroking firm to advise its listing.

Palandri delisted its shares from London’s Alternative Investment Market late last year in favour of an Australian listing, which it said at the time would provide it with a more regulated environment and improve the stock’s liquidity.

Palandri chief executive Darrel Jarvis would not confirm whether the company was close to releasing details of a fundraising to spearhead its listing on the Australian Securities Exchange, other than to say the winery intended to list by the end of 2007.

It is unclear how much money the winery is seeking to raise from investors, although earlier this year Mr Jarvis told WA Business News Palandri expected to raise between $5 million and $10 million via a rights issue.

WA Business News understands that Patersons Securities has been appointed to advise Palandri on its listing.

A letter to Palandri shareholders sent this week says the winemaker will make an announcement about its activities, including its listing plans, “in the next few weeks”.

The listing will come in the wake of one of the industry’s most high-profile public collapses.

Fellow Margaret River winemaker, Evans & Tate Ltd, debuted on the ASX in 1999 but appointed administrators about a fortnight ago following a two-year battle to claw back its massive debts, after an aggressive expansion strategy came unstuck when the industry suffered a massive oversupply of fruit.

And during E&T’s battle, listed producer Xanadu Wines Ltd was forced to sell its assets, with its brand and winery being secured by Victoria’s Rathbone family.

Meanwhile, Australian Wine Holdings Ltd has also been forced to sell its winery assets to repay debts and is now searching for new investment opportunities.

Palandri had anticipated listing on the ASX three years ago but surprised investors with an AIM listing, which coincided with a deadline to repay its bankers about $9 million.

Palandri has imported a “filling plant” from China for the production of its ‘cheer pack’ soft-pack wines.

The plant will be located at its WA contract bottling operation and will be operational next month.

Mr Jarvis said Palandri had contracted out work to a filling plant in Adelaide, but having its own plant would improve quality control.

Palandri will plant 102 hectares of vines near Harvey during October and November despite concern among some sections of the wine industry that the grape glut could return if the east coast vintage returns to normal production levels following two small-yielding, weather-affected vintages.

Palandri’s new plantings have been funded from tax-effective managed investment schemes, which have raised nearly $50 million from investors in the past two years.

Palandri will plant up to a further 100ha of vines during 2008 and 2009.