Flora and Fauna sells online - vegan, ethical and sustainable products and has 300 domestic and international brands across multiple categories, including beauty, lifestyle, baby & kids, pet etc and is a BCorp with 10,000 products across 10 key categories from 300 Australian and international brands.
Julie Mathers started Flora and Fauna after leaving her role as chief of sales and marketing at Coles when she saw the opportunity to support ethical manufacturers having a strong impact on planet, people and animals.
Through the acquisition, founder and CEO of Flora and Fauna, Julie Mathers and her entire team of 47 will join BWX. This is strategically important as it flags the intention of BWX to not only continue the business, but that the team is high quality and important to future growth.
The BWX rational is consistent with what we know about this space, but given their size, their ability to service and scale is a massive win for the eco sector.
“THERE IS A RISE OF ETHICAL CONSUMERS. WE KNOW THAT 65 PER CENT OF CONSUMERS, WANT TO BUY FROM PURPOSE-DRIVEN BRANDS AND ADVOCATE FOR SUSTAINABILITY, BUT ONLY 26 PER CENT OF THEM CURRENTLY DO.
ENVIRONMENTAL ISSUES ARE STILL A MAJOR CONCERN TO 77 PER CENT OF HOUSEHOLDS, AND 62 PER CENT OF PEOPLE ARE WILLING TO PAY MORE FOR SUSTAINABLE ALTERNATIVES. THIS PRESENTS BWX WITH SIGNIFICANT POTENTIAL UPSIDE."
The buy is expected to cost between $27.9 million and $30.8 million, payable on closing based on multiples of financial year (FY) 2021 revenue performance of Flora and Fauna, representing a multiple of between 1.6 and 1.8 times the actual FY21 revenue.
While the agreement is unconditional, BWX has a limited right to cancel the acquisition if there is a material change due to revenue or profitability dropping below a pre-agreed amount before closing.
BWX believes the acquisition will be earnings per share accretive in FY22 and strongly EPS accretive by FY24. The acquisition will be fully funded through a debt facility provided by BWX's lender and completion is anticipated in July this year.
Images: Flora and Fauna