Overview of Transaction and Underlying Asset

Fine wines make interesting investment assets because they are not merely tangible but consumable. Just like its flavor, a wine’s value appreciates with age, making it a suitable medium to long-term investment, especially for favorable vintages that are in high demand by investors and wine enthusiasts.

Phillip Wines, wholly owned by PhillipCapital Group, has launched the 2020 EP Tokens offering investors the opportunity to invest in ABS linked to a selection of 16 finest wine labels being held and matured in barrels at wineries in Bordeaux.

The wine tokens, also known as ‘the En Primeur tokens’ (EP), will be traded on Alta’s exchange platform, a private securities exchange licensed by the Monetary Authority of Singapore. Each asset-backed securities (“ABS”) digital token is linked to a parcel of 36 bottles of 16 wine labels, representing the finest wines of the 2020 Bordeaux EP vintage such as Lafite Rothschild, Haut Brion, and Mouton Rothschild.

Upon bottling in 2023, or at the maturity of the secured notes in 2026, investors can opt to redeem for payment from the sale of wines or physical collection of the wines. Up to the time of maturity of the EP Tokens in 2026, they would also be tradable on AltaX, providing investors access to a secondary market.

Significance of the listing

Previously, without a history of purchasing Bordeaux EP, it would have been impossible for private customers to get access to these highly regarded wines. Investors are able to purchase these wines directly from the source as opposed to from 3rd party auction sites and wine merchants with potential provenance issues.

The tokens grant early access to a basket of wines with considerable long-term price appreciation potential, at an attractive entry point and an improving global macroeconomic backdrop. This also marks the launch of Southeast Asia’s first tradeable digital wine-based Token.

With the favorably priced releases, Bordeaux may see a possible increase in demand. The price of an En Primeur wine is expected to be lower than the release price on the market, and acquiring them or wine futures also allows investors to hold highly demanded wines that may potentially be impossible to find when they are released on the market.

How Alta facilitated the listing

Alta was actively involved in the introduction of the deal to potential investors, leveraging its deep expertise and extensive track record in the alternative asset space.