TIDMSEED
Seed Innovations Limited
20 August 2021
Seed Innovations Ltd / AIM: SEED / Sector: Closed End
Investments
20(th) August 2021
SEED Innovations Limited ("SEED" or the "Company")
Investee Company Update: Yooma Wellness
SEED Innovations Ltd, the AIM quoted company investing in fast
growing and industry leading businesses with a focus on the medical
cannabis, health and wellness space, is pleased to note an
announcement by its portfolio company, Yooma Wellness Inc.
('Yooma').
Yooma has completed its first acquisition since its successful
admission to trading on the AQSE Growth Market ("AQSE") on 10
August 2021. The acquisition was made via Yooma's wholly owned
subsidiary, Yooma Europe Limited, of UK-based Vitality CBD Limited
("Vitality"), a leading CBD company, for a total consideration of
up to GBP10.2 million (including 7,706,422 shares issued at
GBP0.545 per share) and advances Yooma's stated buy-and-build
strategy. Following the acquisition and admission of consideration
shares, SEED will hold approximately 4.54% of Yooma.
The announcement by Yooma is set out below without material
changes or adjustments:
Yooma Wellness Inc. (CSE:YOOM; AQSE:YOOM), a global vertically
integrated wellness platform that develops and markets a portfolio
of CBD and wellness brands, is pleased to announce it has completed
the acquisition of Birmingham-based Vitality CBD Limited
("Vitality"), a UK-market-leading CBD company, for a total
consideration of up to GBP10.2 million (the "acquisition"), via the
Company's wholly owned subsidiary, Yooma Europe Limited.
The acquisition adds a significant source of recurring revenue
to Yooma and its subsidiaries, through Vitality's presence at
mainstream retail outlets such as Boots, Tesco, Asda and Lloyds
Pharmacy, as well as expanding the Group's target customer base and
distribution network for its existing European-focused brands,
including the MYO plant nutrition platform.
In the six-month period to 30 June 2021, Vitality had gross
turnover of GBP1.6 million and EBITDA of approximately GBP300,000.
There are significant synergies to be had and by working with the
Yooma management team, Vitality will focus on growing revenue and
margin in the latter half of 2021 as well as expanding distribution
to other European and International markets.
This is the first acquisition since it completed the
dual-listing of its shares on the AQSE Growth Market in London on
10 August 2021 and is part of Yooma's buy-and-build strategy.
Lorne Abony, Chairman of Yooma, commented: "Completing the
acquisition of Vitality is the first step of the strategic plan the
Company outlined to investors at the time of our UK financing and
dual-listing - to buy and build companies globally, focused on
materially increasing the Company's top-line revenue, leveraging
the Group's integrated supply chain to drive margin growth, and
expanding distribution for the existing product portfolio. This
acquisition will help accelerate our growth by exporting these
branded products to other Yooma jurisdictions and integrating with
our MYO Plant Nutrition operations and distribution. Vitality is a
market leader in the UK with presence in major retail outlets such
as Boots, Tesco, Asda and Lloyds Pharmacy and we look forward to
working with the team at Vitality."
Nikhil Nathwani, Co-founder and Managing Director commented on
the acquisition : "The whole Vitality CBD team are excited to be
joining the Yooma group. CBD is a growing industry not only in the
UK but globally, and the acquisition positions us nicely to be able
to continue to expand and grow the business."
Details of the Acquisition
Under the terms of a sale and purchase agreement, the Company
has acquired 100% of the issued shares of Vitality for total
consideration of up to GBP10.2 million (the "Consideration")
comprising:
Ø GBP4 million cash at closing ("Cash Consideration") subject to
agreed working capital adjustments (Vitality being acquired on a
cash-free / debt-free basis);
Ø 7,706,422 new common shares of the Company ("Consideration
Shares") representing GBP4.2 million issued at an implied price of
GBP0.545 per share; and
Ø up to GBP2 million of cash or share-based consideration, at
the Company's option, subject to the achievement of revenue
milestones by Vitality for the financial year 2022 as set out
below:
Value of the 2022 Revenue Value of the Deferred
Consideration due to
the Sellers
Greater than GBP5 million but GBP500,000
less than GBP6 million
GBP6 million or more, but less GBP1 million
than GBP7 million
GBP7 million but less than GBP8 GBP1.5 million
million
GBP8 million or more GBP2 million
Cash consideration for the acquisition will be funded from the
Company's existing cash.
100% of the Consideration Shares are subject to a lock-in, with
25% of the Consideration Shares being released from the lock-in on
each of the 10-month, 16-month, 22-month and 28-month anniversaries
of completion.
The Company has received customary warranties and indemnities in
relation to the business and operations, assets, trading and
financial affairs of Vitality (with related tax covenant and
warranties).
The current senior management team at Vitality have been
retained and will continue to operate the business day-to-day as
the Company focuses on integration and expansion.
Admission of Consideration Shares and Total Voting Rights
Application will be made for the Consideration Shares, which
will rank pari passu with the existing common shares in issue, to
be admitted to trading on the AQSE Growth Market ("Admission").
Dealings are expected to commence on or around 23 August 2021.
Following Admission, Nikhil Nathwani, the largest shareholder of
Vitality prior to the acquisition by the Company, will hold a total
of 4,623,852 common shares of the Company, representing 4.74% of
the Company's issued common shares.
The Company's total issued and voting share capital upon
Admission of the Consideration Shares will consist of 97,497,707
common shares. This figure may be used by shareholders as the
denominator for the calculations by which they will determine if
they are required to notify their interest in, or a change to their
interest in, securities of the Company.
About Vitality CBD Limited
Vitality CBD is the most widely stocked brand of CBD in the UK
with products distributed in national retailers such as Boots,
Tesco, ASDA and Lloyds Pharmacy. Vitality CBD is also prominent on
E-commerce retailers such as Amazon, Very & Ocado. The Vitality
CBD product portfolio has over 60 SKUs including oils and sprays in
a wide range of flavours and strengths, edibles, and a specially
developed and formulated range of CBD skin care cosmetic
products.
About Yooma Wellness Inc.
Yooma's mission is to build a vertically-integrated global
leader in the manufacturing, marketing, distribution, and sale of
wellness products including hemp seed oil and hemp-derived and
cannabinoid (CBD) ingredients. The company leverages strategically
curated sales channels and ecommerce networks to deliver a diverse
mix of wellness products through operating subsidiaries in the
United States, United Kingdom, France and Japan. Learn more at
www.yooma.ca .
For further information, please contact:
Yooma Wellness Inc. Via Buchanan
Jordan Greenberg, CEO Tel:+44 (0) 20 7466
jgreenberg@yooma.ca 5000
AQSE Corporate Adviser: Tel: +44 (0) 20 7469
Peterhouse Capital Limited 0930
Guy Miller / Mark Anwyl Tel: +44 (0) 7990
139 093
Media Enquiries (Canada):
Michael Bancroft
michaelbancroft@globalive.com
Media Enquiries (UK / Europe): Tel: +44 (0) 20 7466
Buchanan 5000
Henry Harrison-Topham / Jamie Hooper www.buchanan.uk.com
Ariadna Peretz / George Beale
yooma@buchanan.uk.com
-Ends -
For further information on the Company please visit www.seedinnovations.co or contact:
Ed McDermott SEED Innovations Email: info@seedinnovations.co
/ Ltd
Lance de Jersey
James Biddle Beaumont Cornish Tel: +44 (0) 207 628
/ Limited, 3396
Roland Cornish Nomad
----------------------- -----------------------------------
Isabella Pierre Shard Capital Partners T: +44 (0)20 7186 9927
/ LLP
Damon Heath
----------------------- -----------------------------------
Catherine Leftley St Brides Partners Email: info@stbridespartners.co.uk
/ Ltd,
Isabel de Salis Financial PR
----------------------- -----------------------------------
Notes
SEED Innovations is an AIM quoted investment company focused
primarily on disruptive high growth life sciences and technology
businesses particularly within the medical cannabis arena. The
Company's strategy is to identify early stage opportunities that
have an upcoming investment catalyst and grow its portfolio in
terms of value whilst limiting the number of investee companies to
a level where relevant time can be devoted to each.
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END
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