good natured Products Inc. announces closing of acquisition of FormTex Plastics
by CM Staff
FormTex produces custom plastic packaging for the medical, food, electronic, industrial, and retail end markets.
VANCOUVER — good natured Products Inc., a North American manufacturer of plant-based products, announced that, through a wholly owned subsidiary, it has closed the acquisition of all the business and operating assets of Houston-based FormTex Plastics Corporation for cash consideration of approximately USD $4.8 million. The Acquisition will be funded in cash from the Company’s treasury. The terms of the Acquisition were first announced in the Company’s news release dated May 4, 2022.
“We are very pleased to complete this Acquisition and welcome everyone at FormTex to the good natured® family,” said Paul Antoniadis, CEO of good natured®. “The addition of FormTex expands the scope and reach of our packaging business, in-line with the strategic direction we’ve communicated, and we believe there is material upside potential for revenue and profitability through capacity expansion, supply chain improvements and cost synergies previously disclosed.”
“We believe partnering with good natured® is a win-win scenario for our valued employees and customers,” said Mark Anselmo, co-owner of FormTex. “It is a very strong strategic fit, and we see the same path to much larger and more profitable operations leveraging greater access to capital and good natured®’s internally produced extruded rollstock capacity. This in turn will enable us to have a more significant positive environmental impact by producing more sustainable packaging solutions that the market is demanding.”
FormTex produces custom plastic packaging for the medical, food, electronic, industrial, and retail end markets. FormTex is ISO 9001:2015 certified in the design and manufacture of thermoplastic molded components and operates seven different thermoforming machines in a leased 51,000 square foot facility on 1.9 acres of land in Houston, Texas.
Key Highlights of the Acquisition:
- FormTex generated unaudited revenue of approximately USD $4.9 million and adjusted EBITDA1 of approximately USD $0.6 million in the calendar year ended December 2021.
- FormTex generated unaudited revenue of USD $5.1 million for the trailing twelve months ended February 28, 2022.
- FormTex generated an unaudited gross margin rate of approximately 42% in FY2021.
- The Acquisition includes a minimum of USD $650,000 of net working capital as part of the purchase price.
- The Acquisition adds 30 business-to-business (“B2B”) accounts to the Company’s active B2B customer base.
- The current management team operating FormTex will be joining the good natured® team.
- Highly strategic and synergistic acquisition that is expected to be immediately accretive to shareholders on an adjusted EBITDA1 basis.
- Expected to provide cost synergies of approximately USD $0.2 to $0.3 million in the twelve months following the close of the Acquisition.