Silk Laser will spend $52m to buy Australian Skin Clinics and New Zealand-based The Cosmetic Clinic.
The 100 per cent acquisition of the ASC Group parent company Beauty Services Holdings Pty Ltd is a $47m upfront cash consideration with an earn-out amount of up to $5m to be paid out in ordinary shares in Silk.
To partially fund the transaction Silk has launched a fully underwritten placement of approximately 4.7 million shares to raise $20m.
The acquisition takes Silk nearer to its medium goal of 150 clinics. It can leverage the brand strength of ASC on the eastern seaboard and scale its entry in Victoria and New Zealand.
Martin Perelman, Silk CEO and co-founder said “Together, we will be one of the leading chains in the Australia market, giving our clients more choice, more innovation and most importantly, better service and results.
“The ASC Group acquisition is an exciting opportunity for Silk and delivers on our growth strategy. ASC Group is well aligned to our existing service offering and complements our existing network, whilst providing scaled entry into Victorian and New Zealand markets.
“The acquisition solidifies our market leadership as a major player in Australia with 103 clinics and entry into New Zealand with 14 clinics. This increased scale provides opportunity for further value creation through synergies and further investment in our brand and customer experience.”
Perelman said the ASC Group and Silk are aligned in business philosophy. “Both brands believe that strong financially healthy franchise partners and happy clients drive strong results,” he said.
The acquisition of the two brands is expected to be completed by the end of August 2021.
Silk recently reached its 60 store milestone ahead of its ASX market prediction.
