- 01Elixinol buys Vitable via all-scrip, perf deal.
- 02Value: $2.5m in shares; floor $0.00525; adds subscription platform.
- 03Earn-out + platform kicker total up to ~$1.6m.
Elixinol Wellness (ASX: EXL) has entered into an all-scrip performance-based agreement to acquire Australian personalised supplement subscription platform Vitable.
The acquisition will add recurring subscription revenue, proprietary personalisation technology, and direct consumer capability to Elixinol’s existing portfolio of health and wellness brands, accelerating its strategy to build a scaled Australian wellness platform.
Under the terms, Elixinol will issue Vitable with a headline consideration of $2.5 million in shares over five tranches at a floor price $0.00525 each for a maximum 476.19 million shares.
This will include $625,000 in performance consideration shares, based 50% on net revenue and 50% on direct EBITDA gains for the 12-month period following the transaction.
A “platform kicker” comprising an additional $1m of Elixinol shares will also be offered in the event that Elixinol’s market capitalisation as implied by its 20-trading-day volume weighted average price exceeds $20m within 26 months of the acquisition.
Extending Elixinol’s Business
Founded in 2019, Vitable operates a direct-to-consumer subscription model using a digital platform that combines an online health assessment with proprietary recommendation technology to offer personalised daily supplement packs to customers.
The acquisition will extend Elixinol’s business beyond its existing branded portfolio by adding an established subscription platform, a recurring revenue channel, and more personalised, ongoing engagement with consumers.
It will also offer cross-selling opportunities, whereby Elixinol can introduce complementary products from its existing portfolio—including premium health and lifestyle brand The Healthy Chef—to Vitable customers.
Vitable is expected to add more than $5m in revenue to Elixinol’s books, taking it past $20m in annual revenue, accelerating its path to profitability, and unlocking future growth.
On full realisation of the scrip-based earn-out terms, the combined business will target $27m in revenue and approximately $3m in EBITDA by 2028, representing a step change in scale for Elixinol shareholders.
Complementary Acquisition
Elixinol chief executive officer Natalie Butler said the complementary acquisition would create opportunities to grow customer value across the group.
“Vitable brings us an established subscription-based consumer platform, proprietary personalisation capability, and direct consumer relationships [that] are highly complementary to our existing Australian health and wellness brands,” she said.
“Having reset the business and sharpened our focus on Australia, this acquisition marks the next phase of our company’s growth.”
The transaction is being backed by Vitable shareholder and Brenteca Investment chair Ben McHarg, who has participated in a $500,000 contribution to Elixinol via a convertible note and is in discussions to advise the company’s board and management.
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