- Cellmid (CDY) acquires BLC Cosmetics from HLG Limited (HNG)
- The company has today paid $3 million for the purchase, comprising $1 million cash and 32.7 million shares issued at 6.1 cents each
- Cellmid says the acquisition is profitable with $7 million in revenue expected to grow
- CDY appoints Phillip Christopher as non-executive director, effective November 5
- Shares in Cellmid are trading steady at 6.5 cents, while shares in HLG Limited are up 1.59 per cent to 32 cents each
Health and beauty technology business Cellmid (CDY) has acquired all of the shares in BLC Cosmetics from fellow ASX-lister HLG Limited (HNG).
Under a share sale agreement, Cellmid today paid HNG $3 million on settlement, comprising $1 million cash and more than 32.7 million shares priced at 6.1 cents each.
Issuance of the shares, which represent 15 per cent of Cellmid’s post-issue capital, was approved at a general shareholders’ meeting on October 22.
Notably, the shares are subject to a voluntary escrow agreement between the parties for a period of 24 months.
Following the purchase, Cellmid said its latest acquisition was profitable with around $7 million in revenue — a figure it said had continued to grow despite a pandemic-affected 2021 financial year.
Additionally, the consumer staples stock said the merged businesses shared complementary distribution channels with opportunities for cross-selling into each others respective professional and retail customer bases.
Non-executive director appointment
In other news, Cellmid has appointed Phillip Christopher to its board as a non-executive director, effective November 5.
Mr Christopher will stand for election at the upcoming general meeting of shareholders and could remain on the board while HGL has an interest equal to, or greater than, five per cent in Cellmid.
Mr Christopher, who is also investment director at HGL, is an investment professional with more than 12 years’ experience across private equity, mergers and acquisitions, and capital markets.
“We are delighted to welcome Phillip to the board and look forward to his strategic input in the significant growth prospect of the company’s health and beauty tech business,” Cellmid Chairman Bruce Gordon said.
Cellmid remains fully funded and purchased BCL Cosmetics using $1 million from its own cash reserves, without the need for a capital raise.
Shares in Cellmid were trading steady at 6.5 cents, while shares in HLG Limited were up 1.59 per cent to 32 cents each at 2:30 pm AEDT.