ASX-listed drinks business Mighty Craft has announced a strategic review of its operations in a sign it may be looking to expand its program of asset sales beyond “non-core assets”.

The self-described craft beverage accelerator said in an announcement to the stock exchange that it had listened to feedback from several large shareholders and was launching a formal strategic review focusing on reducing its debt by returning capital to the business and “realising value for shareholders”.

The company said this included the need to “assess possible further / larger divestments” after the company has been unable to secure the previously announced divestments of its smaller, non-core breweries.

In February 2022 the company announced its intention to simplify its portfolio by divesting some of its smaller assets. At the time it included breweries such as Queensland’s Ballistic and Slipstream as “key brands going forward”.

Ballistic subsequently went into administration, before being acquired by a consortium, seeing Mighty Craft write off its investment and additional convertible notes.

In September last year the company divested itself of Sparkke, agreeing to “forgive any liability owed to it under the convertible notes in Sparkke” which had a total face value of $1.5 million

Managing Director Mark Haysman told investors in March that the company was “very close” to finalising a number of sales, though the sales were taking longer than expected.

“It’s just probably in the current environment, where we’re seeing, even in the last three months, people being a little bit more careful than there were in the three months prior to that.”

With the company unable to secure the sale of the growing group it considers to be non-core assets, questions are raised as to what assets would be included in ‘further/larger’ divestments.

As recently as March the company’s 100 per cent-owned Jetty Road and Mismatch breweries were listed as central to the company’s strategy going forward, and also that month raised $5.2 million saying that some of the funds raised would be used to invest in Better Beer, in which it holds a one-third share.

That raising was at 14.5 cents per share, at the time a 20 per cent discount to the then share price of 18 cents. Since then shares have fallen to close yesterday at $0.10, falling further on current trade.

The company’s current market capitalisation is below $40 million, less than the $47 million it paid for the Adelaide Hills Group alone, which included Mismatch Brewing, in 2021.

That valuation is despite the company’s third share in Better Beer, which is yet to close its own capital raise. Mighty Craft hinted that raise could see that brand alone valued at more than $200 million based on other brewery sales.