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RNS Number : 2437B
Silverwood Brands PLC
30 September 2022
DATE: 30 September 2022
Silverwood Brands plc
("Silverwood" or the "Company")
Acquisition of NBY London Limited
Silverwood Brands plc, an enterprise company established to
invest primarily in branded consumer businesses, is pleased to
announce the conditional acquisition ("Acquisition") of NBY London
Limited, which trades internationally under the brand name
Nailberry ("Nailberry"), a multi-award-winning category leader in
non-toxic nail products. The Acquisition is conditional on certain
financing arrangements being completed, which is expected to occur
within the next few days. As part of the transaction, Sonia Hully,
founder of Nailberry, will continue to lead Nailberry as its
executive director.
Details of the Acquisition
Nailberry is a premium nail products brand founded in 2013 by
Sonia Hully, a French London-based entrepreneur. The brand offers a
wide array of award-winning colours and nail products using a
healthy and breathable formula, known as L'Oxygéné. Nailberry's
nail polishes are formulated to be free of toxic chemicals and are
certified vegan, cruelty free and halal. The brand's motto, "Colour
your nails healthy", emphasises its commitment to the well-being of
its customers' nails.
Nailberry generated approximately GBP2m in sales in the year
ended 31 December 2021 and achieved an unaudited, adjusted EBITDA
of GBP700,000. The company's net assets as at that date stood at
approximately GBP2.2m. Management accounts indicate that trading in
the six months ended 30 June 2022 was materially above that
achieved in the comparative prior period. The Directors of
Silverwood believe that Nailberry has clear growth opportunities
and, as such, is a great addition to the Silverwood portfolio of
beauty brands.
The Company has conditionally acquired 100% of NBY London
Limited's share capital for an initial cash consideration of GBP6.0
million. The Acquisition terms further include a deferred
consideration of up to an additional GBP4.0 million payable in
Silverwood shares and subject to achieving certain performance
criteria dependent on sales and EBITDA growth over the next three
years.
The deferred consideration will be calculated through an equal
weighting between an EBITDA compound annual growth rate payment and
a revenue compound annual growth rate payment during the earn-out
period which is from the day of completion to the third anniversary
of completion.
The EBITDA compound annual growth rate payment will be
calculated as follows:
- If the achieved EBITDA compound annual growth rate is equal to
or greater than 35%, the sum of GBP2,000,000 will be paid; or
- If the achieved EBITDA compound annual growth rate is less
than 35% but greater than 20%, the sum paid will be calculated by
multiplying GBP2,000,000 by the EBITDA compound annual growth rate
percentage.
- If the achieved EBITDA compound annual growth rate is 20% or lower, then zero will be paid.
The revenue compound annual growth rate payment is calculated as
follows:
- If the achieved revenue compound annual growth rate is equal
to or greater than 40%, the sum of GBP2,000,000 will be paid;
or
- If the achieved compound annual growth rate is less than 40%,
but greater than 25%, the sum paid will be calculated by
multiplying GBP2,000,000 by the revenue compound annual growth rate
percentage.
- If the achieved revenue compound annual growth rate is 25% or
below, then zero will be paid.
As such, the maximum total deferred consideration will be
GBP4,000,000.
The deferred consideration will be paid at prevailing share
price at the end of the earn-out period.
Advisers
Nnenna Onuba of 21 Road Ltd and Joel Palix of Palix Unlimited
Ltd acted as Joint Independent M&A advisers to Nailberry.
Knights served as legal counsel to Silverwood, and Simons Muirhead
Burton LLP served as legal counsel to Nailberry.
About NBY London Limited
More information is available on Nailberry's website,
www.nailberry.co.uk.
Andrew Gerrie, the Executive Director of Silverwood Brands,
said:
"Acquiring Nailberry gives us an opportunity to work with an
amazing founder and businesswoman in Sonia Hully. We are delighted
that Sonia will be staying as a director of Nailberry to continue
to drive growth in the business. We are looking forward to working
with Sonia and the team at Nailberry to build the brand. We are
very optimistic about the future for this business."
Sonia Hully, the Founder and CEO of Nailberry, stated:
"I am very excited that Nailberry is joining the Silverwood
family. I personally remain fully committed to the ethical
principles upon which I developed the brand and am thrilled that
Andrew Gerrie and Silverwood share the same principles. I very much
look forward to working with Andrew and the Silverwood team to
continue to grow Nailberry in the UK and internationally and to
expand the Silverwood portfolio with other promising brands."
Change of Year End
The Company is also amending its year end reporting date from 31
August to 31 December with immediate effect. The Company will issue
interim financial statements covering the period from incorporation
to 31 August 2022. Subsequently interim and annual reports will be
published each year for the 6 months to 30 June and 12 months to 31
December respectively.
For more information, please contact:
Silverwood Brands plc
Andrew Gerrie info@silverwoodbrands.com
--------------------------
VSA Capital - AQSE Corporate Adviser and
Broker +44(0)20 3005 5000
--------------------------
Andrew Raca, Simba Khatai, Pascal Wiese (Corporate
Finance)
Andrew Monk, David Scriven, Peter Mattsson
(Corporate Broking)
--------------------------
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END
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