LONDON, UK: Silverwood Brands plc, an enterprise company established to invest primarily in branded consumer businesses, has acquired interests in two consumer brands comprising Lush, a UK headquartered international cosmetics retailer, and Sonotas, a Japan-based skincare manufacturer.
Silverwood has conditionally acquired approximately a 19.8% stake (“Lush Sale Shares”) in each of Lush Cosmetics Limited (LCL) and Lush Cosmetic Warriors (LCW), together (Lush) from Executive Director, Andrew Gerrie and his wife Alison Hawksley.
In addition, Silverwood Brands has conditionally acquired 90% of the share capital of Sonotas Holdings Corporation and 100% of Sonotas Corporation from Executive Director, Andrew Tone and other sellers.
Silverwood has entered into a sale and purchase agreement to acquire the Lush shares. The total consideration for the acquisition of the Lush shares amounts to approximately £216.8 million to be satisfied via the issue and allotment of 228.212 million new ordinary shares to the Lush vendors at the price of 95p per share, being the closing price of a Silverwood share the business day immediately before this announcement.
Lush is a manufacturer and seller of fresh handmade skincare goods and cosmetic products. LCL is the operating company responsible for the management of the business whilst CWL owns the rights to the Lush brand and controls the research and development of new products.
Lush operates retail outlets in 48 countries and has manufacturing facilities in 6 nations. It produces a wide range of beauty and personal care products which include: creams, soaps, shampoos, shower gels, lotions, moisturisers, fragrances, scrubs, toothpaste tablets, masks and other cosmetics for the face, hair, and body using only vegetarian or vegan recipes.
Lush is a British success story and is now a well-established brand with a defined global footprint and the potential to meet strong growth targets in the future. The acquisition last year of its North American partner business has paved the way for a substantial increase in revenue and stronger cash flows over the short-term as well as the opportunity to expand its physical and online presence in the US and Canadian market.
Silverwood Brands has conditionally agreed to acquire 90% of the total issued share capital of Sonotas Holdings together with 100% of the total issued share capital of Sonotas Corporation from Andrew Tone, a Director of the Company and certain other sellers.
In addition, Silverwood has entered into a put and call option arrangement with Andrew Tone which entitles the Company to acquire (or for him to require the Company to acquire) from him the 10% balance of the total issued share capital of Sonotas Holdings during the 6 month period commencing 48 months from the date of completion.
On completion of the Sonotas acquisition, approximately £417,000 in cash and approximately £15.6 million in Silverwood shares will be paid to the Sonotas vendors.
The Sonotas companies comprising Sonotas Corporation and Sonotas Holdings Corporation are headquartered in Japan and they manufacture, sell, import and export skincare products. They purchase raw materials in-house and outsources manufacturing through external factories. Sonotas owns two brands Steamcream and Cigarro. These brands are sold through wholesale sales at directly managed stores, official online stores, limited-time shops, limited-time shops at department stores and variety shops such as Takashimaya, Mitsukoshi, and Daimaru. The Sonotas directors include Andrew Tone (Managing director), and Shizuka Tagami.
Paul Hodgins, Non-Executive Director of Silverwood, said: “I am delighted to announce the transactions relating to Lush and Sonotas. Both are tremendously exciting companies with a vast amount of growth potential. Silverwood is a rapidly growing business, with a team of highly experienced independent directors, and we are entrepreneurs ourselves.
We have great respect for the strong values and track records of both these highly entrepreneurial companies. We look forward to engaging their management to provide support and to add value where we can, and in doing so also provide strong value to our own rapidly growing shareholder group.”