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Wattle Health (ASX:WHA) acquires brand and distribution business for $4.75M
Source: The Weekly Times
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  • Wattle Health Australia (WHA) is set to acquire businesses Brand Solutions Australia and Pharma Solutions Australia for $4.75 million
  • Brand Solutions Australia and Pharma Solutions Australia, together termed BSA, is a Melbourne-based brand development, brokerage and distribution business
  • The proposed transaction will involve a combination of cash and shares totalling $4.75 million
  • The company has also proposed to change its name, pending shareholder approval, to Wellnex Life which it says "fully captures the dynamic nature of the business"
  • BSA's founder and principal director, Zack Bozinovski, will join Wattle as Executive Director and Chief Strategy Officer once the proposed transaction is complete
  • Wattle Health hasn't traded since February last year

Wattle Health Australia (WHA) is set to acquire businesses Brand Solutions Australia and Pharma Solutions Australia for $4.75 million.

Established in 2010, Brand Solutions Australia and Pharma Solutions Australia, together termed BSA, is a Melbourne-based brand development, brokerage and distribution business.

Through a binding asset sale agreement, the proposed transaction will involve WHA buying the assets of BSA for $2.75 million in cash and the issue of $2 million in fully paid ordinary Wattle Health shares at 15 cents each.

A payment of up to $500,000 in cash is also expected to repay existing debt of BSA.

Further, Wattle Health will pay the vendors of BSA a deferred earn-out consideration, comprising cash and further shares, subject to the performance of BSA which will be measured on earnings before interest, taxes, depreciation, amortisation (EBITDA) hurdles.

The deal is subject to a number of conditions including WHA's shares being reinstated to quotation on the ASX and BSA obtaining novation or assignment of certain material contracts of the business.

Shareholder approval is also needed and will be sought at WHA's upcoming annual general meeting.

BSA's portfolio includes over 15 strategic brands in the health and wellness sector including distribution for brands such as Simply 7 and Compeed.

The company also represents the Wattle Health brands Uganic and Little Innoscents and had secured ranging for both brands in Chemist Warehouse and Australian Pharmaceuticals Industries.

WHA believes the combination of its brands with BSA’s portfolio will further extend the company’s influence in the Australian and global health and
wellness markets.

A new name, Wellnex Life, has been proposed for the synergy, which is said to "fully capture the dynamic nature of the business".

The change of company name will be presented at the upcoming annual general meeting and upon shareholder approval, the new ASX ticker code will be WNX.

Additionally, BSA founder and principal director Zack Bozinovski will join Wattle as Executive Director and Chief Strategy Officer once the proposed transaction is complete.

Wattle Health will be hosting an investor briefing tomorrow where Executive Director, George Karafotias, will discuss the proposed transaction and provide a
general investor update.

Wattle Health hasn't traded since February last year.

WHA by the numbers
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