REG - Venture Life Group - Acquisition of Health & Her Limited

Venture LifeAnnouncement

30/10/2024 07:00

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RNS Number : 1487K  Venture Life Group PLC  30 October 2024

This Announcement contains inside information as defined for the purposes of
Article 7 of the Market Abuse Regulation (EU no. 596/2014), as it forms part
of the United Kingdom domestic law by virtue of the European Union
(Withdrawal) Act 2018, as amended. This announcement has been authorised for
release by the Company's Board of Directors.

 

30 October 2024

 

 

VENTURE LIFE GROUP PLC

("Venture Life", "VLG" or the "Group")

 

Acquisition of Health & Her Limited

 

Venture Life (AIM: VLG), a leader in developing, manufacturing and
commercialising products for the international self-care market, is pleased to
announce the acquisition of the entire issued share capital of Health &
Her Limited ("H&H"), a specialist female health business from its
founders, Kate Bache and Gervase Fay (the "Founders") and other shareholders,
for an upfront cash consideration of £7.5m. A further £0.7m in cash is
payable 12 months post completion, dependent upon the Founders remaining with
the business for at least 12 months, with an additional £1.8m of
consideration payable in cash contingent upon  H&H achieving expected
trading results for the 12 months post completion.

 

H&H, headquartered in Cardiff and founded in 2018, is a brand currently
predominantly focused on female health, specifically the transitional elements
of hormone health, providing supplements and digital support for the female
hormonal health journey. Whilst their menopause and peri-menopause products
currently constitute the majority of the business's revenue, the business has
extended its offering further and will shortly be launching new products in
the female hormonal health area and also into the area of male hormonal
health. H&H is a leading brand in hormonal wellbeing supplements, and
offers a free educational app to support holistic health. The H&H app is
the world's second-largest menopause app, the No.1 menopause app recommended
by ORCHA, and the first to publish its impact on menopausal health (British
Medical Journal).

 

The global menopause market was estimated at $16bn in 2023 (by Grand View
Research), but Forbes Magazine estimates it to rise to $600bn by 2030,
demonstrating substantial market growth over the next 7 years, meaning the
current product range is selling into a rapidly growing market segment.

 

H&H sells a range of food supplements through retailers, pharmacy and
online channels, and currently generates sales in six countries including the
UK, USA, China and parts of the EU. In the UK, the products are sold through
retailers such as Holland & Barrett, Boots and Superdrug, as well as
online via its own website, and the VLG Board believes that opportunities
exist to leverage the products across VLG's extensive distribution network in
the UK and internationally. H&H's products are also listed on Amazon in
the UK, Germany and the USA, where online performance has led to recent new
listings also being achieved in the USA through CVS and The Vitamin Shoppe.

 

H&H has conducted extensive research in menopause alongside its academic
partners and key opinion leaders. It is this deep knowledge and insight that
has built an exciting pipeline of innovations that will be launching across
many channels in the short and medium term.

 

Revenues for the financial year ended 31 May 2024 were £6.1 million with a
loss before tax of approximately £0.4 million. The VLG Board believes that
the historic profitability of the business was significantly impacted by costs
invested to build awareness of Health & Her's brand and to develop best in
class technology solutions to reach its consumers. Financial performance for
the current accounting period to end of September 2024 demonstrated annual run
rate EBITDA of £0.8 million. Under VLG's ownership the VLG Board expects to
achieve significant synergies between VLG and H&H, at both a revenue and
operating level which involve cross business resource synergies as each
business will exploit its expertise for the benefit of the other and these
will become effective during 2025.

 

The acquisition price of the business is on a cash free/debt free basis and
comprises initial consideration of £7.5 million paid in cash, using a
combination of the Company's cash reserves and its revolving credit facility.
Further deferred contingent consideration of £1.8 million is payable in cash
based on expected trading results being achieved for the 12 months post
completion, plus a deferred payment of £0.7 million in cash which acts as a
retention bonus for the Founders remaining with the business for at least 12
months post completion.

 

Group net leverage(2) is expected to peak at 1.7x immediately on completion,
but anticipated to fall to 1.6x by 31 December 2024, further reducing to 0.8x
within 12 months.

 

This acquisition significantly strengthens and expands the Company's position
in women's health, adding to the existing Balance Activ proposition, and
propels Venture Life into the rapidly expanding area of supporting hormone
deficiency through life stages for both men and women.

 

 

Jerry Randall, CEO of Venture Life Group plc commented: "We are delighted to
have acquired H&H, an exciting and dynamic business in the innovative area
of supporting hormone change in men and women through all life stages. The
business has been well invested in its growth and development, and we will be
able to leverage all these assets going forward. Recent new launches into the
US retail market and a deep pipeline of new products are expected to deliver
meaningful growth in the short to medium term. We are very pleased also that
the dynamic and innovative founders, Kate Bache and Gervase Fay, will be
staying with us to continue the H&H journey and growth. Hormone change is
an area poorly understood by the consumer, but with tools such as the H&H
app and specifically designed food supplements consumers can access
significant education and support for these changes. Becoming part of the
Venture Life Group will allow the considerable resources of the Group to be
applied to continue to drive the growth of the business, expanding its reach
and generating meaningful synergies with our current portfolio and
operations."

 

 

Kate Bache and Gervase Fay, founders of H&H commented: "We are thrilled by
today's announcement of the acquisition of H&H by VLG. Venture Life
Group's success and momentum in the self-care space, combined with their
extensive retail and market reach, promise to further our mission to support
the lives of millions of people around the world with the life-affecting
impact of hormone change. Joining VLG opens up extensive opportunities for
synergies - particularly within the female health category alongside the VLG
brand Balance Activ. We're confident that our combined strengths will bring
significant value to our customers and key stakeholders as we embark on this
exciting new chapter. I am immensely grateful to our loyal customers,
dedicated team, and investors, whose support has been pivotal to our success
to date".

 

 

(1) Run-rate EBITDA calculated based on current period trading for the four
months up to end of September 2024 being £0.8m

(2) Group net leverage calculated as net debt(3) (excl. finance leases) and
Adjusted EBITDA(4) on a trailing 12-month basis.

(3) Net debt calculated as gross debt (excl. finance leases) less cash

(4) Adjusted EBITDA calculated as EBITDA before deduction of exceptional items
and share based payments

( )

 

For further information, please contact:

 

 Venture Life Group PLC                                    +44 (0) 1344 578004
 Jerry Randall, Chief Executive Officer

 Daniel Wells, Chief Financial Officer

 Cavendish Capital Markets Limited (Nomad and Broker)      +44 (0) 20 7397 8900
 Michael Johnson (Sales)

 Stephen Keys / Camilla Hume (Corporate Finance)

About Venture Life (www.venture-life.com (https://www.venture-life.com/) )

Venture Life is an international consumer self-care company focused on
developing, manufacturing and commercialising products for the global
self-care market. With operations in the UK, Italy, The Netherlands and
Sweden, the Group's product portfolio includes some key products such as the
UltraDEX and Dentyl oral care product ranges, the Balance Activ range in the
area of women's intimate healthcare, the Lift and Glucogel product ranges for
hypoglycaemia, Gelclair and Pomi-T for oncology support, Earol for ear wax
removal, products for fungal infections and proctology, and dermo-cosmetics
for addressing the signs of ageing. Its products are sold in over 90 countries
worldwide.

 

The products, which are typically recommended by pharmacists or healthcare
practitioners, are available primarily through pharmacies and grocery
multiples. In the UK and The Netherlands these are supplied direct by the
Company to retailers, elsewhere they are supplied by the Group's international
distribution partners.

 

Through its two Development & Manufacturing operations in Italy and
Sweden, the Group also provides development and manufacturing services to
companies in the medical devices and cosmetic sectors.

 

 

 

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