Jamieson Wellness Inc. to Acquire Nutrawise Health & Beauty Corporation

Jamieson Wellness Inc. announced it has signed a definitive agreement to acquire Nutrawise Health & Beauty Corporation (“Nutrawise”), a leading innovator, manufacturer and marketer of premium supplements under the youtheory brand in the United States and other international markets, for approximately US$210 million ($265 million) on closing, plus potential additional consideration contingent on achieving pre-determined growth targets post-closing. Management anticipates the transaction will close during the Company’s third quarter of 2022, subject to certain regulatory approvals and customary closing conditions.

“This transaction is a major strategic milestone for Jamieson, accelerating our expansion in the world’s largest vitamin, mineral and supplement market,” said Mike Pilato, President and CEO of Jamieson Wellness. “Youtheory’s co-founders Darren and Patty Rude have built a remarkable company and brand that is highly complementary to our existing portfolio and perfectly aligned with our commitment to providing consumers with high-quality products they can trust. The transaction is immediately accretive to Jamieson, and we see significant opportunities for future growth synergies as we leverage our broad product portfolio, best-in-class operational capabilities and global footprint to accelerate youtheory’s expansion across multiple categories and channels in the United States and around the world.”

Darren and Patty Rude have committed to working with the Company to help drive mutual growth aspirations for the youtheory brand. “Patty and I founded Nutrawise over ten years ago with the mission to build a business based on integrity, authenticity and quality,” said Darren Rude, co-founder of Nutrawise. “Jamieson Wellness shares a similar mission and values, and we are confident that the combination of Nutrawise, the youtheory brand and Jamieson’s expertise will further accelerate our growth and continue to support the health and wellness needs of our consumers.”

Transaction Details
The acquisition of Nutrawise fits Jamieson’s disciplined acquisition strategy and is expected to leverage the Company’s best practices, enhancing its overall growth and margin potential. The transaction is valued at approximately US$210 million ($265 million), including US$25 million ($32 million) in Jamieson Wellness common shares to be issued to the sellers, plus potential additional consideration contingent on achieving pre-determined growth targets post-closing, payable at the election of the sellers in cash, Jamieson common shares, or some combination thereof. The addition of Nutrawise is expected to be immediately accretive with pro forma 2022 revenue of between US$123 and US$126 million ($155 and $159 million) and Adjusted EBITDA of between US$22 and US$23 million ($28 and $29 million), which excludes transaction and integration-related costs and certain purchase accounting expenses. Jamieson expects to complete the transaction in the third quarter of 2022, subject to certain regulatory approvals and customary closing conditions including approval of the Toronto Stock Exchange.

The Company intends to finance the acquisition with an expanded, amended and extended credit facility. BMO Capital Markets, National Bank of Canada, Royal Bank of Canada and The Bank of Nova Scotia have provided committed financing in support of the transaction.

Following the transaction, Jamieson Wellness expects to continue to have access to capital to support further acquisitions and strategic growth initiatives, aided by a strong balance sheet and expanded free cash flow expected from the combined business. After giving effect to the acquisition and related financing, Jamieson Wellness expects to have a prudent level of leverage at approximately 3.0 times pro forma Adjusted EBITDA as of closing of the transaction.4

Advisors
BMO Capital Markets and RBC Capital Markets are serving as financial advisors and Ernst & Young LLP as tax advisors to Jamieson Wellness. Paul, Weiss, Rifkind, Wharton & Garrison LLP and McCarthy Tétrault LLP are serving as the Company’s legal advisors.

William Hood & Company are serving as exclusive financial advisors and Greenberg Glusker LLP and Bowen Tax Law are serving as legal advisors to the sellers.

Jamieson Wellness has received fairness opinions from BMO Capital Markets and RBC Capital Markets to the effect that, as of the date of the fairness opinions, subject to the assumptions, limitations and qualifications contained therein, the consideration to be paid under the transaction is fair from a financial point of view to the Company.

1 This is a non-IFRS financial measure. See the “Non-IFRS and Other Financial Measures” section of this press release for more information on this non-IFRS financial measure. The adjusted EBITDA of the Company for the year ended December 31, 2021, was C$100.1 million.
2 Unless otherwise indicated, pro forma figures for 2022 give effect to the Nutrawise acquisition as if it had occurred on January 1, 2022.
3 All figures in $CAD millions unless otherwise indicated.
4 This is a non-IFRS ratio. Refers to trailing twelve months Adjusted EBITDA of the Company and Nutrawise divided by net debt, each as of the expected closing date for the transaction. “Net debt” is a non-IFRS financial measure. See the “Non-IFRS and Other Financial Measures” section of this press release for more information on these non-IFRS and other financial measures.