to Acquire U.S. and Canadian Subscription Brands - BattlBox and Carnivore Club to become EMERGE's 6th and 7th brands in North America, and will be its largest and most profitable acquisition to date
- BattlBox and Carnivore Club generated combined revenues of approximately US$23 million and Adjusted EBITDA of approximately US$3.3 million in the trailing twelve months ended May 31, 2021
- Transaction expected to be funded with existing cash on hand
- Upon closing, this acquisition will boost EMERGE's monthly subscription revenue and is expected to be immediately accretive to EBITDA
- Acquisition provides EMERGE with a strong US-based operating team with deep expertise in subscription-based e-commerce and cost-effective warehousing
TORONTO, Aug. 30, 2021 /CNW/ - EMERGE Commerce Ltd. ("EMERGE" or the "Company") (TSXV: ECOM), a leading acquirer and operator of direct-to-consumer ("D2C") e-commerce brands, has signed a definitive agreement (the "Agreement") to acquire all of the respective membership interest and shares of BattlBox, LLC ("BattlBox") and its affiliates, namely Carnivore Club, LLC and Carnivore Club Subscription Box Canada Inc. (together with BattlBox, the "BattlBox Group") (the "Transaction") for US$10.25 million in cash, US$1.5 million in deferred consideration payable over 3 years, and contingent earnout consideration of up to US$7.2 million over a 3 year period.
BattlBox (www.battlbox.com) is a market-leading survival, outdoor and camping goods subscription business-based in the U.S., and notably, featured in its own Netflix Original show, "Southern Survival", in 2020. Carnivore Club (www.carnivoreclub.co) is a premium artisanal meat subscription business in Canada, with a presence in the U.S.
BattlBox Group generated revenue of approximately US$23 million (unaudited) and Adjusted EBITDA of approximately US$3.3 million in the trailing twelve months ended May 31, 2021. The acquisition is expected to be immediately accretive to EMERGE's EBITDA.
"BattlBox Group will be our largest and most profitable acquisition to date, and provides us with a very capable and disciplined operating team in the U.S. with deep subscription-based e-commerce expertise," said EMERGE Founder and CEO, Ghassan Halazon. "The acquisition delivers two excellent brands with tremendous growth opportunities. Firstly, BattlBox, a highly profitable, market leader in the fast-growing survival, outdoor gear, and camping subscription space in the U.S., and second, Carnivore Club, a leading premium artisanal, cured meat subscription box, which we view as a complementary offering to truLOCAL, our premium meat subscription business. We see strong potential for cross-selling, and leveraging shared facilities over time."
"Over the last several years at the BattlBox Group, we have assembled an incredibly talented team that has scaled the business profitably without any outside capital. With the tremendous success leading up to and following our recent Netflix Original show, 'Southern Survival', we were looking for a strategic partner that could help drive the business to the next level. With EMERGE, we found exactly what we were searching for. EMERGE will support us in our future growth endeavors, enabling us to leverage their M&A playbook, extensive member database, data insights, and shared services. This will allow us to accomplish our ambitious goals more cost-effectively and expeditiously." said John Roman, BattlBox Group Partner and CEO upon execution of the Agreement.
The Transaction is expected to be funded with cash on hand. The guaranteed (upfront and deferred cash) consideration represents a multiple of approximately 3.6 times Adjusted EBITDA, based on the BattlBox Group's unaudited financial statements for the trailing twelve-month period ended May 31, 2021.
https://www.newswire.ca/news-releases/emerge-signs-definitive-agreement-to-acquire-u-s-and-canadian-subscription-brands-battlbox-and-carnivore-club-816882477.html