It may have just gone public, but that isn’t stopping Zoglo’s Incredible Food Corp (CSE: ZOG) from focusing on expansion. The plant-based food firm this morning indicated that it has entered into a non-binding letter of intent to acquire a majority stake in Monday Swiss.
The LOI entered into between the two firms outlines a transaction whereby Zoglo’s would take a 50.5% stake in the plant-based food developer and manufacturer. The transaction is expected to support additional product development for Zoglo’s, enabling its product portfolio to continue to evolve to consumer tastes.
The acquisition is also expected to enable global expansion for Zoglo’s, while also increasing annual sales by up to $6.0 million. Monday Swiss currently is viewed as a leading manufacturer of plant based foods in Europe, with the company having distribution at Tesco, Co-Op, Ocado, Holland % Barret, among other retailers.
Originally founded in 2012, Monday Swiss currently produces a large variety of plant-based food options, which are sold under the Monday Swiss and Veggie Day Brands. The company is heavily focused on R&D, having developed what is referred to as next-generation meat analogues along with industry leading texture, quality and innovation, all of which is expected to be brought to North America by Zoglo’s.
Under the terms of the LOI, Zoglo’s is to take a 50.5% stake in the firm, subject to a definitive agreement which is to be entered into by August 27. The current terms indicate that the transaction has a value of EUR$5.1 million, which is to be paid for in the form of common shares. A further EUR$0.75 million is to be invested in the firm upon closing, while a loan of up to EUR$1.0 million is to be provided to enable a production expansion. Alon Cahn, founder of Monday Swiss, is also to become the CEO of Zoglo’s European Ops under the arrangement.
Zoglo’s Incredible Food last traded at $0.41 on the CSE.
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