AS MADARA Cosmetics announces landmark brand transactionInside information, 2024-04-30 07:25 CEST --
MADARA Cosmetics AS has signed a binding agreement with Oy Transmeri Ab (‘Transmeri’) for the asset-based carve-out and future contract manufacturing facilitation for the MOSSA brand.
Since the launch of the MOSSA brand in 2014 its sales have largely retained a ca.10% share of overall turnover. This reflects the dedication which has been directed towards growing the flagship MÁDARA brand across many different geographical markets as the Company’s primary corporate identity.
For reference, key aspects of MOSSA (compared with the MÁDARA brand) include being positioned at the middle of the price range, with a slightly higher price than most competitors in mass market channels, justifying the price with natural, organic ingredients. In comparison MÁDARA is positioned at the more affordable end of the premium price segment in most markets. Moreover, the MOSSA brand has had a different distribution strategy due to its design for mass retail channels. This transaction is expected to secure further MOSSA brand growth in the Finnish market, while at the same time boosting contract manufacturing capacity volumes. The Company will retain ongoing product development responsibility for MOSSA.
“Efficient use of corporate resources is critical in creating long-term shareholder value. The transaction not only enables us to re-focus on our core strengths – MÁDARA corporate and brand long-term strategy execution, it also confirms the Company’s ability to generate valuable brand-related assets. Particular attention will be towards MÁDARA brand awareness building in France, Germany and Sweden,” states Gunta Šulte, CEO of AS MADARA Cosmetics.
“Having assumed the key role in bringing the Company to the Latvian capital market in 2017 it has been a pleasure to see the value it has generated to its investors since then (close to twice the IPO price) as well as through the brand-based corporate transaction unique to the Latvian market” says Ivars Bergmanis, partner at ViaClarus OÜ.
With ample liquidity in the balance sheet prior to this transaction management is continuing to evaluate various possibilities for the efficient deployment of capital for future investments including, but not limited to further market entry and diversification prospects particularly in European markets, which is the home region of the MÁDARA brand. Additional trademark creation and development is also planned via a ‘brand laboratory’ concept.
The total consideration is EUR 4 million and closing of the transaction is expected on April 30, 2024. Due to Oy Transmeri Group Ab’s shareholding in the Company (22.89% of shares as of the date of this announcement) this transaction is deemed to have been undertaken with a related party.
The financial advisor for the transaction was ViaClarus OÜ and the legal support was provided by ZAB Eversheds Sutherland Bitāns SIA.
Management retains its previous guidance which is to achieve turnover growth of at least 10% in 2024 (ie. EUR 22.25 million) compared to the previous year.
Management Board of AS “MADARA Cosmetics”
The shares of AS Madara Cosmetics are admitted to trading on Nasdaq Baltic First North Market.
The Certified Adviser for AS Madara Cosmetics is ZAB Eversheds Sutherland Bitāns SIA.
AS MADARA Cosmetics was founded in 2006 and has become one of the leading cosmetics manufacturers in Northern Europe and a leader in Latvia. The company' s brand MÁDARA is a pioneer in the natural skincare and make-up segment in Latvia. Since November 2017, the company's shares have been listed on the Nasdaq Baltic alternative market First North. For more information, visit investors.madaracosmetics.com.
Contact information:
Address: 131 Zeltiņu Street, Mārupe district, Mārupe, LV 2167, Latvia
Contact person: Gunta Šulte, member of the Management Board
E-mail: ir@madaracosmetics.com
Phone: +371 67 470 243
Certified adviser:
ZAB Eversheds Sutherland Bitāns SIA
Contact person: Justīne Ignatavičute
E-mail: justine.ignatavicute@eversheds-sutherland.lv
Phone: +371 28 665 066
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