Silverwood buys Lush stake & acquires Sonotas

Silverwood buys Lush stake & acquires Sonotas

Silverwood Brands plc has announced that it has purchased a stake in Lush and acquired Japan-based skincare business Sonotas. These investments represent significant additions to the Silverwood portfolio of brands which already includes Balmonds and Nailberry.

Silverwood has acquired approximately 19.8 per cent of Lush for £216.8 million, conditionally 90 per cent of the share capital of Sonotas Holdings Corporation, and the entire share capital of Sonotas Corporation for £18 million (Japanese ¥ 3,024.2 million).

Silverwood will use the acquisitions as a platform for further expansion into consumer businesses with a focus on health and beauty, speciality foods and other consumer focused brand sectors.

Commenting on the announcement, Paul Hodgins, non-executive Director of Silverwood, said: “Both companies have exciting brands and huge growth potential in some of the largest cosmetics markets globally. We are delighted to invest in two talented management teams as they continue on their growth journeys. These latest acquisitions provide a solid platform for Silverwood to continue expanding its portfolio of fast-growing consumer brands. As entrepreneurs ourselves with significant expertise in building leading brands, we bring long-term, highly engaged and supportive British growth capital to our portfolio while creating value for our own rapidly growing shareholder base.”

Lush is a manufacturer and seller of fresh handmade skincare goods and cosmetic products. Operating retail outlets across 48 countries and manufacturing facilities in six locations, it produces a wide range of beauty and personal care products ranging from creams and soaps to cosmetics including perfumes and face powders using only vegetarian or vegan recipes.

Last year, Lush acquired its North American partner business which has paved the way for a substantial increase in revenue and stronger cash flows over the short term, as well as the opportunity to expand its physical and online presence in the US and Canada.

“Lush is a British success story with a well-established brand and defined global footprint. We think there is considerable potential to meet strong growth targets in the future and are excited about the opportunities worldwide,” Hodgins added.

Silverwood intends to hold its stake in Lush for the long term. As an Aquis Stock Exchange (AQSE) quoted company, Silverwood will provide an opportunity for Lush customers to invest into Lush and reap the benefits of their support.

Japan-based Sonotas manufactures, sells, imports and exports skincare products and own brands SteamCream and Cigarro. These brands are sold through multiple channels including official online stores, department outlets and shops including Takashimaya, Mitsukoshi, and Daimaru. SteamCream products include moisturising creams, masks, face cleansers and lotions. Hand-made in Japan, SteamCream uses vegan and naturally-derived ingredients and safe synthetics in its products, which are used by over 10 million people around the world.

Cigarro is a men’s self-care brand that uses high-quality products, natural ingredients and unique fragrances and formulas in its products which range from facial care, body care, fragrances, and towels. Silverwood Directors believe that Sonotas represents an opportunity to acquire a unique and scalable product range which has considerable synergies with the Company’s existing brands including natural skincare cream Balmonds and Nailberry, a category leader in non-toxic nail products.

“Male grooming and beauty is one of the most significant growth areas in cosmetics today and Sonotas has enjoyed substantial commercial success in Japan which we believe can be replicated in other markets around the world. At the same time, Sonotas will further provide the Silverwood group of brands with an experienced team in Japan to manage the introduction of our brands to the Japanese market,” Hodgins added.

Silverwood has also entered into a put and call option arrangement which entitles the Company to acquire the 10 per cent balance of the total issued share capital of Sonotas Holdings Corporation during the six-month period which commences 48 months from the date of completion.


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