Wellness and Beauty Solutions Limited (ASX: WNB) has acquired the business of Organic Nation, which owns an extensive range of organic cosmeceuticals.
Organic Nation’s products fuse ingredients from nature with cosmeceutical ingredients.
The anti-ageing skin and body care products in the Organic Nation range are currently sold in more than 100 clinics outlets in Australia and Canada.
The key terms of the sale agreement and consideration are:
- Issue of shares to the value of $250K, with a deemed issue price of $0.007 per share;
- A cash payment to acquire all stock, which is expected to be $120,000 and to be in two tranches. The first to occur immediately and the second at the conclusion of Stage 4 lockdown; and
- At the conclusion of Year 1, a cash payment to the seller equal to 15% of gross sales value of Organic Nation Product sold by True Solutions capped at $300K.
Christine Parkes CEO and Managing Director of WNB says the company expects Organic Nation to generate around $250,000 in revenue for the remainder of this this financial year (FY21), based on previous financial results of Organic Nation for FY20, with the expectation to grow revenue to $1M in annualised revenue over the coming years.
Ms Parkes said the increase in revenue over the coming years is based on the company’s expectation from the benefit of the existing True Solutions network being leveraged. These benefits are attributed to being the owner distributer of the Organic Nation brand portfolio as opposed to being distributed by other third parties.
There is unrealised potential in Organic Nation and we are confident that we can grow retail sales as the beauty sector start to reopen. It’s an exciting product range that fits perfectly within our own philosophy of offering beautiful organic products that are scientifically backed to improve skin condition,” Ms Parkes said.