good natured Products (TSXV:GDNP) announced recently a $9.5M acquisition of Shepherd Thermoforming and Packaging, diversifying the Company’s revenue streams
SmallCapPower | March 5, 2020: good natured Products Inc. (TSXV:GDNP), North America’s leading producer of renewable, plant-based consumer products and packaging, announced on March 3, 2020, the acquisition of Shepherd Thermoforming and Packaging Inc.
good natured Products acquires Shepherd, a leading thermoformer with over 35 years’ experience. GNDP announced on March 3, 2020, its plans to acquires Shepherd Thermoforming & Packaging and all of its real estate assets for $9.5 million in cash plus a contingent earnout payment of $2.25 million. Shepard designs custom packaging including engineering, mold production and final product manufacturing for both thin gauge and heavy gauge applications. In addition to the Share Purchase, an earnout of $2.25M in the 42 months to 60 months post-closing upon satisfaction of certain milestones relating to an increase in the value of the real estate purchased, is part of the transaction.
Leader in thermoformer packaging. Shepherd is a leading thermoformer with over 35 years’ experience in designing custom packaging, including engineering, mold production, and final product manufacturing for both thin gauge and heavy gauge thermoformed applications. The acquisition includes a total of six thermoforming machines, two CNC machines and a series of proprietary molds, including the ability for designing, prototyping and manufacturing molds. This acquisition also includes a 42,000 square foot manufacturing facility on 2.31 acres of land in Brampton, Ontario.
Acquisition to drive significant revenue growth. Shepherd’s current customers include several Fortune 500 companies located throughout eastern Canada and northeastern United States. Shepherd operates six different thermoforming lines as well as two CNC machines at its fully-integrated design, mold manufacturing, testing and manufacturing facility. Shepherd generated average annual revenue of over $5.5M and average annual adjusted EBITDA of $420K over each year in the prior three fiscal years. Recall that good natured Products generated ~9.5M in revenue in F2019, which enables GDNP to increase its production capacity and expand its plant-based packaging assortment to meet the needs of more customers.
good natured is completing the final stages of financing required to close the Share Purchase with its financial partners, including the Business Development Bank of Canada, under the terms and conditions of its previously-announced BDC financing from June 2019. The closing of the transaction is expected to be not later than April 30, 2020.
To read a copy of the Shepherd acquisition press release or to listen to the conference call regarding the announcement of the acquisition, visit the good natured Products website at www.goodnatured.ca under the Investor Relations section.
About good natured Products
good natured Products, through its subsidiaries, designs, produces, and distributes bioplastics for use in packaging and durable product applications in Canada. It offers packaging products for baked goods, deli and prepared meals, and fruits and veggies; desk accessories, including stackable legal desk trays, vertical file holders, self-stacker desk trays, pencil holders, and paper clip dispensers; recyclers and waste bins; and totes and crates.
good natured products closed Wednesday’s trading session at C$0.15. good natured stock trades at a market cap of C$15M.
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