Forbidden Foods has entered into an agreement to acquire plant-based dairy alternative company Oat Milk Goodness.
Forbidden Foods, based in Australia, will acquire 100% of the capital of fellow Australian company Oat Milk Goodness (OMG) for a total consideration of AUD 3.42 million (approx. $2.3 million) which will be settled via the issue of 285 million new fully-paid ordinary shares in Forbidden Foods at a deemed issue price of AUD 1.2c per share.
OMG was established to develop a locally-grown oat milk product that takes advantage of Australia’s abundant natural oat supply, and is also free from industrial seed oils such as canola, rapeseed and sunflower oil. The company was co-founded by Australian cricketer Steve Smith, and is currently delivering annualised revenue of AUD 1.2 million (approx. $804,383).
Since its establishment, OMG has broadened its core offering to include flavoured milk alternatives and higher-protein options. It has also expanded distribution through listings with Woolworths and Ampol Foodary outlets, as well as independent health food stores.
OMG is actively pursuing international expansion opportunities with a focus on India, where it sees an opportunity to leverage co-founder Smith’s profile in the Indian market and take advantage of increased demand for health products in the region.
According to Forbidden Foods, the acquisition will provide considerable operational and corporate advantages, including reduced overheads and internal administrative costs.
The company said it will leverage its established Australian distribution footprint and relationships with major retail groups to drive uptake of OMG’s plant-based range, which will complement the group’s existing Blue Dinosaur healthy snack line.
Alex Aleksic, CEO at Forbidden Foods, said: “We are pleased to confirm this strategic acquisition with a company of OMG’s calibre. The proposed transaction represents a unique opportunity to leverage the respective strengths of both companies and create an integrated multi-channel, health-focused products business serving domestic and international markets.”
He added that the deal marks Forbidden Foods’ first step toward transitioning to a brand manager in the ‘better-for-you’ segment.
OMG’s co-founder Smith commented: “We are excited to have entered into this SPA with Forbidden Foods and are confident that it will provide a springboard for OMG’s future growth. While there are a number of synergies between the businesses, OMG has the potential to benefit from the agreement through access to capital markets and international expansion opportunities. I would like to take this opportunity to thank all shareholders, as well as key management for their support as we progress the business’ next phase of growth.”
The transaction is subject to shareholder approval and other customary closing conditions.
Top image: © Oat Milk Goodness
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