LONDON, UK: S-Ventures plc (AQSE: SVEN) announced the acquisition of 100% of the share capital of Hero UK Ltd trading as Juvela.
Hero UK has been acquired from the Hero Group, a Swiss consumer foods group. The company manufactures and distributes a range of branded gluten free products under the Juvela brand which include a high quality and tasty free-from range of breads, mixes and pastas sold in the UK retail and pharmacy markets.
S-Ventures plc has agreed to acquire Juvela for a consideration of £8 million cash and five million new ordinary shares in S-Ventures. The cash is split £6.5 million on completion and £1.5 million deferred plus 8% interest, payable in September 2023.
The five million shares to be issued to Hero Group as part of the consideration, will represent 3.8% of the Company’s enlarged share capital and will make Hero group a new shareholder and partner in S-Ventures PLC.
The Hero Group is an international food company focused on branded nutritional food products which generated revenues of CHF 1.14 billion in 2021. The Group, boasts a global footprint and its portfolio consists of many well-known international and local brands.
In order to provide funding for the Acquisition and for general working capital needs, S-Ventures PLC has also entered into new loan facilities provided by Shawbrook Bank Limited including a four year term loan of £5.5m and a £500,000 revolving credit facility.
Juvela is a business manufacturing and distributing gluten-free and free-from products from its factory in Pontypool, Wales. They have been manufacturing gluten free food for people diagnosed with coeliac disease for over 25 years and are the leading brand serving the UK coeliac community under the brand name Juvela. The product range also includes bread, flour mixes, breakfast cereals, pasta, pizza bases, crackers and biscuits.
In the year ended 31 December 2021, Juvela achieved a gross revenue of £8.8 million and has continued to operate profitably this year with expected gross sales of £8.6 million. The net assets acquired amounted to £7.5m.
The synergies between the Group’s existing brands and Juvela are extensive with many opportunities to combine resources and cross fertilise brands and distribution channels, especially with the Group’s Lizza business, acquired in September 2022, which owns a large factory and free-from facility in Frankfurt.
The UK free-from market also presents a significant growth opportunity for S-Ventures having grown at a compound annual growth rate of 6.7% between 2019 to 2021 to £1.86billion, according to the UK Free From Grocery & Pharmacy Market report. The Company believes that this sector is very promising with the potential for substantial future growth.