The offer will crystallize a loss for the shareholders who bought Youfoodz’s $70 million IPO in December. The shares were issued at $1.50 each and never traded above the issue price.
However, it represents a long-awaited payday for founder Lance Giles and his family, who started making ready meals in Brisbane in 2012. Mr Giles will continue to run Youfoodz.
The Giles family and other founding shareholders now own about 14.5% of the company and did not sell any of their shares in the IPO, which valued the company at $202 million, nearly double the value of the HelloFresh offer.
Youfoodz manufactures approximately 400,000 ready meals and snacks per week from its three facilities in Brisbane.
The company had forecast net income to rise 17.7% this year to $149.9 million and expected to post its first profit in years, earning $500,000 before interest, taxes, depreciation and amortization after having accumulated losses of approximately $60 million over the past eight years. .
Youfoodz confirms its prospectus forecasts in February, but issued a downward earnings revision in April, saying it would miss net revenue and EBITDA guidance for the year through June 30. $2 million instead of $2.9 million.
While Youfoodz’s direct-to-consumer/home delivery business has thrived during the pandemic, its business-to-business or retail operations have declined.
The Youfoodz board of directors has unanimously recommended that shareholders accept the offer and vote in favor of the plan, in the absence of a superior proposal and subject to the independent expert concluding that the offer is in their best interest.
RGT Capital, the main shareholder of Youfoodz, which came to the rescue of the company in 2019, intends to vote its 57.4% stake in favor of the program in the absence of a competing offer.
About $25 million of the IPO proceeds were used to repay a loan from RGT Capital, which was taken out to pay tax debts and restructure the business.
The acquisition will increase HelloFresh’s ready-to-eat manufacturing capabilities and expand its total addressable market.
Shares of Youfoodz climbed 78% to 90.7¢ and shares of Marley Spoon rose 5% to $2.96.
Mr Rutledge said the acquisition was a natural next step for the company, which is listed on the Frankfurt Stock Exchange.
This would enhance HelloFresh’s Australian brand portfolio and product offering and combine its expertise in direct-to-consumer marketing, supply chain management and technology with Youfoodz’s strength in development, manufacturing and distribution. ready-to-eat meals.
“Youfoodz’ complementary product and capabilities supported by a well-known brand and a highly skilled team will enable us to serve more dining occasions to more people,” he said.
Youfoodz is advised by Greenhill & Co and Baker McKenzie, while HelloFresh is advised by Clayton Utz.