Total potential consideration for the
acquisition is a combination of cash, restricted equity, a PIK
seller note and a one-time earnout payment
Datasys generated revenues of $25.2 million and EBITDA of $9.1 million in 2022
LAVAL,
QC, Nov. 20, 2023 /PRNewswire/ - Neptune
Wellness Solutions Inc. ("Neptune" or the "Company")
(NASDAQ: NEPT), a consumer-packaged goods company focused on
plant-based, sustainable and purpose-driven lifestyle brands, today
announced it has entered into a non-binding Letter of Intent
("LOI") to acquire Datasys Group, Inc., ("Datasys") and affiliated
companies. The non-binding LOI establishes the framework for a
potential transaction (the "Proposed Transaction") whereby Neptune
would acquire all the outstanding equity of Datasys, subject to
diligence, final board approval, shareholder approval and
additional terms and conditions.
Datasys is a leading data-marketing company that utilizes
artificial intelligence and machine learning to derive intelligence
from one of the largest consumer and business data sets in the
world. Datasys leverages its expansive data of over 3 billion
records and technology to help companies more accurately target
their ideal customers and provide intelligent marketing solutions.
Datasys' clients include leading global corporations such as
Microsoft, Ford, Mastercard and Honda. For full year 2022, Datasys'
unaudited results were $25.2 million
in revenue and $9.1 million in
EBITDA.
Total potential consideration for the acquisition is
$112 million in a combination of
$20 million in cash at closing,
$32 million in restricted equity
based on a pre-closing VWAP of the Company's share price on NASDAQ
(subject to a minimum of 10 million shares) and restricted until
three gradual releases over 10-30 months, a 5-year $31 million PIK seller note (carrying interest at
7%, subject to annual payment of interests, secured by the assets
of Datasys, with principal being payable at maturity subject to a
25% discount in the event of early repayment within 22 months) and
an earnout payment ranging from $5
million to $22 million,
subject to Datasys achieving 2024 EBITDA thresholds between
$13 million and $16 million (or greater). Payment by the Company
of the deferred consideration, whether in payment of the PIK seller
note (both interest and principal) and the earnout payment may be
paid in cash or in kind in the form of Company shares, based on a
VWAP of the Company's share price at the time of payment.
The LOI sets out the initial proposed terms and conditions
pursuant to which the Company and Datasys would effect a business
combination that would result in the acquisition of Datasys by
Neptune, which anticipates becoming a U.S. corporation in the
context of the Proposed Transaction. If definitive documentation
for the Proposed Transaction is agreed upon and the transaction is
consummated, the Company would continue to operate Datasys'
business as a data, analytics, digital media solutions provider and
artificial intelligence technology company with several proprietary
data sets, multiple marketing channels and a robust marketing
cloud. Neptune and Datasys are still in negotiations, have not
executed a definitive agreement and are under no obligation to
enter into or continue negotiations regarding a definitive
agreement relating to the Proposed Transaction.
The Proposed Transaction is subject to the negotiation of
definitive documentation between the parties and it is anticipated
that closing of the Proposed Transaction would be subject to
shareholder approval and additional terms and conditions, including
the need for the Company to secure financing for the cash portion
of the consideration and satisfactory due diligence by the
respective parties. There can be no assurance that a definitive
agreement will be entered into or that the Proposed Transaction
will be consummated on the terms or timeframe currently
contemplated, or at all.
About Neptune Wellness Solutions Inc.
Neptune is a consumer-packaged goods company that aims to innovate
health and wellness products. Founded in 1998 and headquartered in
Laval, Quebec with a United States headquarters in Jupiter, Florida, the company focuses on
developing a portfolio of high-quality, affordable consumer
products that align with the latest market trends for natural,
sustainable, plant-based and purpose-driven lifestyle brands. The
Company's products are available in more than 29,000 retail
locations and include well-known organic food and beverage brands
such as Sprout Organics, Nosh, and Nurturme, as well as
nutraceuticals brands like Biodroga and Forest Remedies. With its efficient and
adaptable manufacturing and supply chain infrastructure, the
company can quickly respond to consumer demand, and introduce new
products through retail partners and e-commerce channels. Please
visit neptunewellness.com for more details.
About Datasys Group Inc.
Datasys Group is a leading
data, analytics and digital media solutions provider with several
proprietary data sets, multiple marketing channels and a robust
marketing cloud. By compiling one of the largest consumer and
business datasets in the world, Datasys uses its expansive
data and technology platforms to help companies more accurately
target their ideal customers and provide intelligent marketing
solutions. For more information, please visit www.datasys.com.
Disclaimer – Safe Harbor Forward–Looking
Statements
This news release contains "forward-looking
information" and "forward-looking statements" (collectively,
"forward-looking statements") within the meaning of
applicable securities laws. All statements, other than statements
of historical fact, are forward-looking statements and are based on
expectations, estimates, and projections as at the date of this
news release. Any statement that involves discussions with respect
to predictions, expectations, beliefs, plans, projections,
objectives, assumptions, future events or performance (often but
not always using phrases such as "expects", or "does not expect",
"is expected", "anticipates" or "does not anticipate", "plans",
"budget", "scheduled", "forecasts", "estimates", "believes" or
"intends" or variations of such words and phrases or stating that
certain actions, events or results "may" or "could", "would",
"might" or "will" be taken to occur or be achieved) are not
statements of historical fact and may be forward-looking
statements.
Forward-looking statements in this news release relate to, among
other things: the Proposed Transaction with Datasys, including
information regarding the non-binding LOI and the anticipated
timing for consummation of the transaction; Datasys' business, the
potential benefits of the Proposed Transaction to the Company and
its financial condition and results of operations, and the
Company's plans if the Proposed Transaction were consummated; and
the terms and conditions for the Proposed Transaction, including
shareholder approval and the need to secure financing for the cash
portion of the consideration. Actual future results may differ
materially. There can be no assurance that such statements will
prove to be accurate, and actual results and future events could
differ materially from those anticipated in such statements.
Forward-looking statements reflect the beliefs, opinions and
projections of management on the date the statements are made and
are based upon a number of assumptions and estimates that, while
considered reasonable by the respective parties, are inherently
subject to significant business, economic, competitive, political
and social uncertainties, contingencies and risks, including, among
other things: the risk that the Company may not be able to
successfully negotiate and execute definitive transaction documents
for the Proposed Transaction on acceptable terms, if at all, and
the ultimate terms and timing for closing of the Proposed
Transaction, which terms may vary from those expressed in the
non-binding LOI; the risk that the Company will not be able to
successfully consummate the Proposed Transaction; the risk that the
Company may not be able to raise sufficient financing for the cash
portion of the consideration or obtain any required approvals,
including shareholder approval, for the Proposed Transaction; the
risk that the Company may not be able to meet the continued listing
requirements of Nasdaq which could result in a de-listing of the
Company's common shares; and, with respect to the Company, the
other risks and uncertainties discussed from time to time in the
Company's filings with the Securities and Exchange Commission (the
"SEC"), including the risk factors described in the section
entitled "Risk Factors" in the quarterly and annual reports that it
files with the SEC. Readers should not place undue reliance on the
forward-looking statements and information contained in this news
release concerning these times. The Company does not assume any
obligation to update the forward-looking statements of beliefs,
opinions, projections, or other factors, should they change, except
as required by applicable law.
Certain supplementary measures in this news release do not have
any standardized meaning as prescribed under International
Financial Reporting Standards ("IFRS"), which are also generally
accepted accounting principles ("GAAP"), and, therefore, are
considered non-GAAP measures. In particular, the term " EBITDA" is
used in this news release to describe certain financial information
contained herein. Earnings before interest, taxes, depreciation and
amortization ("EBITDA") is not a recognized performance measure
under IFRS or GAAP. The term EBITDA consists of net income (loss)
and excludes interest, taxes, depreciation and amortization.
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SOURCE Neptune Wellness Solutions Inc.
