Acquisition Targets Incubating Travel Wear
Market, Provides Centralized Operational Costs, Augments Ecommerce
and Capital Market Expertise
VANCOUVER, BC, March 26, 2021 /CNW/ - RYU Apparel Inc.
(TSXV: RYU) (OTCQB: RYPPF) (FWB: RYAA) ("RYU" or the
"Company"), creator of urban athletic apparel, is
pleased to announce that it has entered into a share exchange
agreement dated March 24, 2021 (the
"Agreement") with Kosan Travel Company Ltd., a private arm's
length British Columbia
corporation ("Kosan"), and the shareholders of Kosan
(collectively, the "Vendors"), pursuant to which RYU has
agreed to acquire all of the issued and outstanding shares of Kosan
from the Vendors (the "Transaction").
Cesare Fazari, CEO of RYU stated,
"We are excited at the prospect of having Kosan join the RYU
family. We expect a big resurgence of travel in 2022 and intend to
capitalize on the increased demand as consumers emerge from the
pandemic. Whether it is heading out across the country or back out
across the world, we believe Kosan's functional travel apparel will
be a hit with RYU customers and new customers alike. We also
believe Kosan's alignment with our message of RESPECT and its
predominantly millennial female audience will augment our brand in
a key market that we are focusing on."
About Kosan Travel Company Ltd.
Kosan was co-founded by Joel
Primus, who is intended to remain as the CEO of Kosan in
addition to assisting RYU's leadership team and corporate
objectives. Joel was the founder and creative visionary behind
numerous products at Naked Underwear (NASDAQ:NAKD), establishing
retail distribution at Holt Renfrew, Nordstrom, Hudson's Bay, and
Bloomingdales, as well as brokering celebrity partnerships and
up-listing the company to the Nasdaq. He was an inaugural British
Columbia Business top 30 under 30 Entrepreneur in 2014 and has
appeared on CBC's hit show Dragon's Den.
Kosan is a web-based travel apparel provider with a core focus
on stylish performance dresses, rain jackets and bags that make
adventures safer, easier and more comfortable. The brand achieved
success on the well-known crowdfunding platform Kickstarter. The
brand achieved nearly $1M in sales
over a 35-day period, making it one of the platforms most
successful apparel campaigns in history.
Kosan has built a loyal community of travelers across the world
by creating beautiful but functional travel wear made from high
quality materials. Kosan sells its popular travel dresses in over
70 countries. The brand has been featured in well-known
publications such as Forbes, Travel + Leisure, SELF and Fodor's.
Kosan's premium clothing can be seen on travel influencers and
digital nomads from around the globe on travel blogs, Instagram
models, and Tik Tok influencers.
Kosan's unaudited net sales for the year ended May 31, 2020 were CAD$944,147 with an achieved gross
margin1 of 39%.
"Kosan was seeing impressive growth before the pandemic hit.
With the travel market predicted to return bigger than ever, we
hope that by joining up with RYU, we will get that traction back
faster than we could on our own," said Primus. "We are confident
that RYU's product development platform, distribution network, and
marketing channels will enable us to scale growth, reduce cost
structures, and exceed our goals for 2022."
Terms of the Transaction
The purchase price for the Transaction will be $4,000,000 worth of common shares (each, a
"Share") in the capital of RYU, with the number of Shares
issuable based on the volume-weighted average closing price of the
Shares on the TSX Venture Exchange ("TSXV") over the thirty
(30) trading-days prior to the closing of the Transaction
("Closing"), or such other price as determined by the TSXV
in accordance with its policies.
Closing is subject to Kosan raising at least $175,000 in equity financing and a number of
other conditions common to similar share exchange transactions,
including the conditional approval of the TSXV. Closing is
also subject to Kosan having no more than $90,000 in aggregate indebtedness on the closing
date.
The Company anticipates that the Transaction will constitute an
Expedited Transaction in accordance with the policies of the
TSXV.
For regular updates on RYU Apparel visit: http://ryu.com
Note:
1
|
Non-GAAP
measure. Gross margin does not have any
standardized meaning under IFRS and therefore may not be comparable
to similar measures presented by other issuers. The Company
defines gross margin as gross profit as a percentage of
revenue. Gross margin should not be construed as an
alternative for revenue or net loss determined in accordance with
IFRS. The Company believes that gross margin is a meaningful
metrics in assessing the Company's financial performance and
operational efficiency.
|
About RYU
RYU Apparel (TSXV: RYU, OTCQB: RYPPF), or Respect Your Universe,
is an award winning urban athletic apparel and accessories
brand engineered for the fitness, performance and lifestyle of the
athletic man and woman. Designed without compromise for fit,
comfort, and durability, RYU exists to facilitate optimal human
performance. For more information, please visit the RYU website
at: http://ryu.com
About Kosan
Kosan creates beautiful, functional travel wear with the finest
materials and best factories from around the world. Their customers
live active lives, travel the world and explore their own
backyards! Kosan's community spans 74 countries and transcends
geography, language, culture and actively champions respect for
human rights, equality, and environmental awareness. Kosan's core
products are performance dresses, rain jackets and bags that make
your adventures safer, easier and more comfortable. They also
donate 1% of its profits to Amnesty International, an organization
supporting and advocating for human rights causes around the
world.
RYU APPAREL INC.
"Cesare
Fazari"
Cesare
Fazari, CEO
Tel: (844) 535–2880
Notice Regarding Forward-Looking
Statements
Certain statements in this news release related to the Company
are forward-looking statements and are prospective in nature.
Forward-looking statements are not based on historical facts, but
rather on current expectations and projections about future events,
and are therefore subject to risks and uncertainties which could
cause actual results to differ materially from the future results
expressed or implied by the forward-looking statements. These
statements generally can be identified by the use of
forward-looking words such as "may", "should", "could", "intend",
"estimate", "plan", "anticipate", "expect", "believe" or
"continue", or the negative thereof or similar variations.
Forward-looking statements in this news release include the
statements respecting the Transaction and the closing thereof, the
Company's expectation that there will be a resurgence of travel in
2021, the expected benefits of the Transaction for both RYU and
Kosan and that Joel Primus is
anticipated to remain as CEO of Kosan post-closing. There are
numerous risks and uncertainties that could cause actual results
and the Company's plans and objectives to differ materially from
those expressed in the forward-looking information, including: that
the Company's assumptions in making forward-looking statements may
prove to be incorrect; adverse market conditions; the inability of
RYU to complete the Transaction on the terms announced or at all;
risks relating to the satisfaction of the conditions to closing the
Transaction; that future results may vary from historical results;
and that market conditions or competition may affect the outcome of
the Transaction and the business plan and operations of the Company
in the future. These and all subsequent written and oral
forward-looking information are based on estimates and opinions of
management on the dates they are made and are expressly qualified
in their entirety by this notice. Except as required by law, the
Company does not intend to update these forward-looking
statements.
Neither the TSX Venture Exchange Inc. nor its Regulation
Service Provider (as that term is defined in the policies of the
TSX Venture Exchange Inc.) accepts responsibility for the adequacy
or accuracy of this press release.
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SOURCE RYU Apparel Inc.