Woolworths Ltd is set to acquire a 25 per cent stake in Western Australian-based brewer Gage Roads for about $2 million.
Gage Roads said on Friday it also would enter into an agreement with Woolworths to supply 350,000 cartons of beer each year to the supermarket chain if the offer is successful.
Under the offer, which is subject to shareholder approval, Woolworths will acquire a 25 per cent stake in the brewer through a placement of 76.4 million fully paid ordinary shares to raise up to $1.9 million.
Following the placement, Woolworths will have an appointee on the brewer's board with Woolworths Liquor Group general manager Steven Greentree becoming a non-executive director.
Gage Roads' chief executive Nick Hayler said the company was delighted to welcome Woolworths as a major shareholder and customer.
He said planning had commenced to maximise brewing capacity from the company's WA brewery operations.
Gage Roads will hold a general meeting in late June at which shareholder approval will be sought.
17 Years Old
4 days ago