Jamieson Wellness Inc. Announces Partnership with DCP Capital to Support Strategic Growth Plan in China
Jamieson Wellness Inc. (“Jamieson Wellness” or the “Company”) (TSX:JWEL) announced today that it has entered into a partnership with DCP Capital (“DCP”), a leading international private equity firm with a long-term track record of success in Greater China and broader Asian markets. DCP will purchase a minority interest in the Company’s Chinese operations and make a preferred share investment in Jamieson Wellness. In conjunction with these investments, DCP will subscribe for warrants to purchase a fixed number of common shares of the Company
TORONTO--(BUSINESS WIRE)--Feb 23, 2023--
Jamieson Wellness Inc. (“Jamieson Wellness” or the “Company”) (TSX:JWEL) announced today that it has entered into a partnership with DCP Capital (“DCP”), a leading international private equity firm with a long-term track record of success in Greater China and broader Asian markets. DCP will purchase a minority interest in the Company’s Chinese operations and make a preferred share investment in Jamieson Wellness. In conjunction with these investments, DCP will subscribe for warrants to purchase a fixed number of common shares of the Company.
The partnership with DCP will accelerate Jamieson’s rapidly growing business in China and bring more world-class, high-quality vitamins, minerals, and supplements to a broader base of Chinese consumers. It will leverage Jamieson’s premium product portfolio, high-quality manufacturing, and R&D expertise combined with DCP’s deep local knowledge, exceptional track record of growing leading consumer businesses, and proven operational capabilities to enhance the Company’s strong organic growth in China.
“This partnership with DCP is a significant next step for Jamieson in the world’s second largest VMS market,” said Mike Pilato, President and CEO of Jamieson Wellness. “In November, we announced the pending acquisition of the assets of our Chinese distributor and the expansion of our on the ground resources in China. The DCP team has 30 years of successful investment experience in China and has partnered with many industry leaders in the consumer sector. DCP's deep experience in China perfectly complements our capabilities and will pave the way to strengthen and accelerate our market opportunities as we move to control the value chain and scale our business in this important and fast-growing market.”
Pursuant to the proposed partnership transaction, DCP will contribute approximately $47.4 million ($35 million in USD) in capital in exchange for a 33.3% share in the ownership structure of the Company’s Chinese operations. The partnership will be led by a board consisting of Directors designated by the Company and DCP, commensurate with their respective ownership interest.
In support of Jamieson’s global health and wellness strategy, DCP will subscribe for approximately $101.6 million ($75 million in USD) of preferred shares in Jamieson Wellness. DCP has the option to require the Company to redeem the preferred shares between the second and fifth anniversary of their purchase. In conjunction with the partnership transaction and the preferred share investment, DCP will subscribe for warrants to purchase 2,527,121 common shares of the Company at an exercise price equal to a 10% premium to the 20-day volume weighted average share price as of February 22, 2023, subject to adjustment pursuant to the rules of the Toronto Stock Exchange (“TSX”). The warrants are exercisable between the second and the fifth anniversary of the issue date.
“We are very excited to partner with Jamieson Wellness, one of the most respected VMS companies in the world and owners of Canada’s number one consumer health brand,” said Hwan Chung, Managing Director of DCP Capital. “The Company’s rich 100 plus year history, superior product quality and exceptional reputation has made the Jamieson brand much sought-after in the Chinese market. Working together with the Jamieson team, we are confident that our local expertise and operational capabilities will help accelerate the development of Jamieson in China and bring more high-quality health products to an expanded consumer base.”
Closing of the partnership transaction is subject to the closing of the previously disclosed acquisition of certain assets from Jamieson’s distribution partner in China and other customary closing conditions, including applicable regulatory approval. Closing of the preferred share and warrant investment is subject to the closing of the partnership transaction and other customary closing conditions, including the receipt of TSX approval. Both transactions are expected to close concurrently in the second quarter of 2023.
Advisors
Nomura Securities International, Inc. is serving as financial advisor and McCarthy Tétrault LLP and Morrison & Foerster LLP are serving as legal advisors to the Company.
CG/Sawaya Partners (operating under Canaccord Genuity) and Solomon Partners are serving as financial advisors and Cleary Gottlieb Steen & Hamilton LLP and Stikeman Elliott LLP are serving as legal advisors to DCP.
About Jamieson Wellness Inc.
Jamieson Wellness is dedicated to improving the world's health and wellness with its portfolio of innovative natural health brands. Established in 1922, Jamieson is the Company's heritage brand and Canada's #1 consumer health brand. Jamieson Wellness also offers a variety of VMS products under its youtheory, Progressive, Smart Solutions, Iron Vegan and Precision brands. The Company is a participant of the United Nations Global Compact and adheres to its principles-based approach to responsible business. For more information please visit www.jamiesonwellness.com.
About DCP Capital
DCP Capital is a leading international private equity firm founded by experienced private equity investors in Greater China. The DCP team previously led KKR and Morgan Stanley’s private equity businesses in Asia, with an outstanding long-term track record across multiple economic cycles. DCP is supported by a diverse group of world-class long-term institutional investors, including leading sovereign wealth funds, pension funds, endowments, family offices and funds of funds around the globe. Over the past three decades, the DCP team has led a number of successful transactions and nurtured numerous industry leaders in China such as Ping An Insurance, Mengniu Dairy, Haier Appliances, China International Capital Corp, Oriental Yuhong Building Material, Dongbao Pharmaceutical, Venus Medtech, 51 jobs, AAC Dairy, Simple Love Yogurt, Nanfu Battery, COFCO Joycome, Sunner Poultry, Far East Horizon, Hengan Intl., Belle, Modern Dairy, and United Envirotech. Combining its global investment experience and extensive local network, the DCP team has accumulated deep industry knowledge and strong operational capabilities. As a disciplined and operationally focused investor, DCP is committed to building long-term, win-win partnerships with portfolio companies and supporting value creation initiatives.
Forward-Looking Information
This press release may contain forward-looking information within the meaning of applicable securities legislation. Such information includes, but is not limited to, statements related to the Company’s growth opportunities and its plans to increase investment in China.
Words such as “expect”, “anticipate”, “intend”, “may”, “will”, “estimate” and variations of such words and similar expressions are intended to identify such forward-looking information. Some of the specific forward-looking statements in this press release include, but are not limited to, statements with respect to: the proposed partnership transaction and preferred share and warrant investment and the terms thereof, the expected date of closing of the transactions and the anticipated benefits to the Company’s shareholders. There can be no assurance that the proposed transactions will be completed or that they will be completed on the terms and conditions contemplated in this press release. The proposed transactions could be modified or terminated in accordance with their terms.
Forward-looking information is based on a number of key expectations and assumptions made by the Company including, without limitation: the transactions will be completed on the terms currently contemplated; the transactions will be completed in accordance with the timing currently expected; all conditions to the closing of the transactions will be satisfied or waived and the subscription agreement entered into today in connection with the preferred share and warrant investment will not be terminated prior to the closing of the transactions. Although the forward-looking statements contained in this press release are based on what the Company’s management believes to be reasonable assumptions, the Company cannot assure investors that actual results will be consistent with such information.
Forward-looking information is subject to a number of risks and uncertainties, many of which are beyond the Company’s control that could cause actual results and events to differ materially from those that are disclosed in or implied by such forward-looking information. Those risks and uncertainties include, among other things: the transactions may not be completed on the terms, or in accordance with the timing, currently contemplated, or at all; and the Company and DCP may not be successful in satisfying the conditions to the transactions. Additional information about risk and uncertainties related to the Company and the assumptions associated with certain forward-looking information is discussed under “ Risk Factors ” in the Company’s Annual Information Form dated March 29, 2022 and under “ Summary of Factors Affecting Our Performance ”, “ Forward-Looking Information ”, “ Risk Factors ” and “ Outlook ” in the management’s discussion and analysis of financial condition and results of operations of the Company filed today, February 23, 2023, both of which are available on SEDAR at www.sedar.com. The Company cautions that the list of risk factors and uncertainties is not exhaustive and other factors could also adversely affect the Company’s results. Readers are urged to consider the risks, uncertainties and assumptions associated with these statements carefully in evaluating the forward-looking information and are cautioned not to place undue reliance on such information.
This forward-looking information is based on the Company’s reasonable assumptions and beliefs in light of the information currently available to it and the statements are made as of the date of this press release. The Company does not undertake any obligation to update such forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required by applicable law.
Source: Jamieson Wellness Inc.
View source version on businesswire.com:https://www.businesswire.com/news/home/20230223005855/en/
CONTACT: Investor and Media Contact:
Ruth Winker
Jamieson Wellness
416-705-5437
rwinker@jamiesonlabs.com
KEYWORD: CHINA NORTH AMERICA CANADA ASIA PACIFIC
INDUSTRY KEYWORD: GENERAL HEALTH VITAMINS/SUPPLEMENTS OTHER HEALTH HEALTH FITNESS & NUTRITION
SOURCE: Jamieson Wellness Inc.
Copyright Business Wire 2023.
PUB: 02/23/2023 04:15 PM/DISC: 02/23/2023 04:15 PM
http://www.businesswire.com/news/home/20230223005855/en
