Author: vishnupriyan

US-based wellness and dietary supplement company Safety Shot has reached a deal to acquire Yerbaé Brands, a plant-based energy drinks company.

The companies signed a definitive arrangement agreement under which all common shares of Yerbaé will be exchanged for an aggregate of 20 million shares of Safety Shot common stock.

This deal represents a basic equity value of $15.2m and an enterprise value of $19.7m, respectively, according to a statement.

Safety Shot shareholders will own approximately 75.8% of the combined business, while former Yerbaé shareholders will hold 24.2%.

Subject to necessary conditions and approvals, the transaction is anticipated to close in the second quarter of 2025.

Founded in 2017 by Todd and Karrie Gibson, Yerbaé specialises in energy drinks made from plant-based ingredients.

In its 2023 fiscal year, the energy drinks maker generated approximately $12m in revenue.

Safety Shot sells a range of 4oz “alcohol reducer” shots which claim to be able to lower blood alcohol and reduce the negative impact of alcoholic drinks on the body. Its drinks also come in a stick pack format.

John Gulyas, Safety Shot chairman, anticipates that the acquisition of Yerbaé will serve as a “significant revenue catalyst” for the company, “on top of an expected revenue growth rate of 50% expected in Q4, versus Q3”.

Safety Shot CEO Jarrett Boon added that the deal is “bringing together the best of both worlds – Safety Shot’s expertise in wellness solutions and Yerbaé’s strength in plant-based beverages – to create a company with significant potential.”

The proposed agreement is expected to generate “significant cost synergies”, according to the statement, primarily through efficiencies in general and administrative expenses and the supply chain.

The business plans to leverage Yerbaé’s “strong” distribution network to enhance its market visibility.

The acquisition is also expected to “enhance” Safety Shot’ visibility and growth trajectory in the US and Canada.

Upon the deal closing, Safety Shot’s leadership team will remain in place while Yerbaé’s team will assume secondary management roles.

Shares of Yerbaé will also be delisted from the Toronto Stock Exchange Venture (TSXV).

Yerbaé CEO Todd Gibson said: “We believe that the transaction will provide us with access to new distribution channels, expanded marketing capabilities, and valuable synergies that will look to benefit both brands.”

Speaking to Just Drinks in September 2023, co-founder Todd Gibson said it planned to build up Yerbaé Brands with the idea of possibly selling it to a larger business.

At the time, he said the “very clear plan is to build this business for it to be an acquirable business by a reputable acquirer”.

He said: “There are nine different major companies, major potential acquirers that are out there. And none of them have a yerba-maté in their portfolio right now. That gives us an opportunity to stand out in that crowd.”

Technology solutions and services provider World Wide Technology (WWT) has signed an agreement to acquire all issued and outstanding common shares of Canada-based Softchoice for C$1.8bn ($1.25bn).

The all-cash deal will be executed through a WWT affiliate, valuing Softchoice at C$24.5 per share.

Birch Hill Equity Partners, directors and senior officers of Softchoice, holding about 51.3% of the outstanding shares, have entered into voting support agreements.

The board of directors has unanimously approved the deal.

Subject to regulatory approvals and customary closing conditions, the transaction is expected to close in late Q1 or early Q2 2025.

Following the deal closing, Softchoice shares will be delisted from the Toronto Stock Exchange (TSX), and the company will cease to be a reporting issuer in all applicable Canadian jurisdictions.

Generating about $20bn in annual revenue, St. Louis, Missouri-based WWT assists enterprises in moving applications to the cloud, deploying artificial intelligence models, and executing other IT projects.

It also builds small-scale test data centres for customers to evaluate new technologies.

Softchoice, generating revenue from cloud, digital workplace, and software management projects, helps companies move on-premises applications to infrastructure-as-a-service platforms.

Its Software & Cloud revenue segment accounts for more than two-thirds of its revenue.

The company also assists enterprises in adopting productivity-enhancing technologies and managing software licenses.

Softchoice reported gross sales of C$628.6m last quarter, marking a 20.3% increase over the same period a year ago.

The company serves more than 5,000 organisations, primarily small and midsize businesses with up to C$10m in annual revenue.

Softchoice president and CEO Andrew Caprara said: “We are excited to join WWT. Its scale and global reach, customer base of large organisations, and industry leading infrastructure solutions are a perfect complement to our software and cloud focused solutions, our Canadian presence, and our strength in the North American mid-market.

“I believe WWT is the ideal partner for our customers and employees and I’m excited about our future as a combined firm.”