Vegaste Technologies Corp (CSE: VEGA) has entered into a letter of intent to acquire Bloombox Club Limited. Bloombox is a leading e-commerce platform that sells indoor plants to an established wellness community. The company operates via subscription services as well as its online shop to deliver its products to its UK-based consumers.
Founded in 2015 by psychologist Dr Katie Cooper, the company has established a customer base of over 24,000 consumers within the United Kingdom, enabling Vegaste to enter the UK and greater European market with a strong start. Currently, Bloombox is operating at an annual run rate of $3.9 million in revenues, while being on target to hit C$4.5 million in revenes for the current fiscal year. Gross margins are currently estimated at $2.3 million, resulting a gross margin of 51%.
The company will continue to operate as a wholly owned subsidiary, ran by Dr Cooper and the current UK-based operations team. The company however will be able to leverage the PlantX platform and e-commerce expertise. Vegaste currently intends to undertake an aggressive expansion into the European markets, with expansion plans being put into place for the Netherlands, Germany, and the rest of Europe.
“Bloombox Club UK has developed a fantastic business in the UK over the past 4-5 years and is run by a high quality team led by Dr. Cooper that we are delighted to have join the PlantX family. The acquisition provides us an immediate presence in the UK and serves as a launchpad for expansion into the rest of Europe and internationally. We have identified numerous synergies that will allow both businesses to scale and accelerate growth. We look forward to growing our future operations around the world with their help.”Sean Dollinger, PlantX Founder
Under the terms of the transaction, Vegaste will acquire Bloombox Club UK for an aggregate purchase price of £8 million. Consideration will consists of £7.4 million in common shares of the company, along with a cash payment of £560,000. Closing of the transaction is expected to occur on October 31, 2020.
Vegaste Technologies last traded at $1.14 on the CSE.
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