Ashurst has advised organic baby food company Bubs Australia Limited (Bubs) on its agreement to acquire 100% of NuLac Foods (NuLac), the owner of the CapriLac and Coach House Dairy brands, and a 49.9% equity interest in the dairy facilities producing NuLac Foods products, including Uphamgo Australia Pty Ltd, a CNCA certified producer of adult goat milk powder and a range of related dairy foods (Milk Processing JV).
The consideration is A$25 million cash with further payments up to A$13.4 million over two years if certain performance targets are met and ordinary shares in Bubs equivalent to 19.99% Bub's post-transaction issued capital. The cash component of the transaction will be partially funded by way of equity raised through a placement and share purchase plan undertaken by Bubs, which is contingent on shareholder approval.
On completion, Bubs will acquire NuLac’s sales and marketing functions, IP and brands, and will enter into agreements with the Milk Processing JV and the vendors for exclusive rights to 100% of their milk supply. Bubs will also have a call option to acquire the Australian farm operating company and associated goat farms from the Australian based vendors in certain circumstances.
Lead partner Kylie Lane (Corporate) commented: "We are pleased to have worked closely with the Board and senior management of Bubs on this strategically important transaction. The proposed acquisition will transform Bubs' business and the successful capital raising is another strong sign of confidence in the strategy being pursued."
Kylie was assisted by partner Elspeth Arnold, senior associates Eliza Blandford and Alyce Ricciardi, lawyer Carrie Hui with graduates Lizzie Bird, Rachel Lapinskas and Sara Malek (Corporate); partner Kellech Smith and senior associate Stuart D'Aloisio (IP); partner Jane Harvey and lawyer Bridget Shelton (Employment); partner Mark Bradley and lawyer Rebecca Lew (Dispute Resolution); partner Richard Brooks and lawyer Jake Saccardo (Real Estate); partner Kenneth Nguyen and lawyer James Szauer (Global Loans); with partners Ian Kellock and Geoffrey Mann, senior associate Bronwyn Kirkwood, lawyer James Sainty and graduate Tim Hutton (Tax).
