AQSE-Quoted Silverwood Brands Buys Lush Stake and Acquires Sonotas

Armstrong Teasdale’s U.K. Capital Markets team advised client, AQSE-quoted Silverwood Brands Plc, the enterprise company established to develop a diversified portfolio of consumer-facing brands and businesses, in connection with its acquisition of minority stakes in Lush, a British skincare and cosmetics manufacturer and retailer (which comprises Lush Cosmetics Limited (LCL) and Cosmetic Warriors Limited (CWL) (Lush Acquisition)), for approximately £216.8 million. The team also advised Silverwood in the conditional acquisition of the Sonotas Group, a Japan-based skincare manufacturer (Sonotas Acquisition), for approximately £18 million (Japanese ¥ 3,042.2 million).

The consideration for the Lush Acquisition was satisfied by the issue and allotment of 282,212,632 new Ordinary Shares by Silverwood Brands to the vendors at a price of 95p per share (Lush Consideration Shares) being the closing price of Silverwood shares the business day immediately before the transaction was announced. The Lush Consideration Shares were admitted to trading on 15 December 2022.

The total initial consideration for the Sonotas Acquisition is £18 million to be satisfied by payment of an aggregate amount of £417,000 (Japanese ¥69,999,992) in cash and the issue and allotment of approximately £15.6 million (Japanese ¥2,613,146,722) in new Ordinary Shares by Silverwood Brands to the Sonotas vendors at a price of 95p per share being the closing price of Silverwood shares. Completion of the Sonotas Acquisition is expected to take place in early January 2023 subject to certain conditions.

VSA Capital Limited is AQSE Corporate Adviser and Broker to Silverwood Brands.

Armstrong Teasdale U.K. Head of Capital Markets Joan Yu commented:

“We are delighted to assist Silverwood Brands with another two acquisitions in the consumer brands sector and look forward to exciting developments in 2023.”

The Armstrong Teasdale team was led by Yu with assistance from Partner Nick Heap, Solicitor Cameron Sutton (qualified in Western Australia) and Trainee Solicitor Sebastian Clark.

Silverwood Non-Executive Director Paul Hodgins said:

"I am delighted to announce the transactions relating to Lush and Sonotas. Both are tremendously exciting companies with a vast amount of growth potential. Silverwood is a rapidly growing business, with a team of highly experienced independent directors, and we are entrepreneurs ourselves. We have great respect for the strong values and track records of both these highly entrepreneurial companies. We look forward to engaging their management to provide support and to add value where we can, and in doing so also provide strong value to our own rapidly growing shareholder group. We have really enjoyed working with Joan and the wider Armstrong Teasdale team.”

Lush is a manufacturer and seller of fresh handmade skincare goods and cosmetic products. LCL is the operating company responsible for the management of the business, whilst CWL owns the rights to the Lush brand and controls the research and development of new products. 

Sonotas Group comprises Sonotas Corporation and Sonotas Holdings Corporation, which are headquartered in Japan and manufacture, sell, import and export skincare products. They purchase raw materials in-house and outsource manufacturing through external factories. Sonotas owns two brands, Steamcream and Cigarro. These brands are sold through wholesale sales at directly managed stores, official online stores, standalone limited-time shops and at department stores, and variety shops such as Takashimaya, Mitsukoshi and Daimaru.