SILK completes $52m acquisition of Australian Skin Clinics

SILK completes $52m acquisition of Australian Skin Clinics

Adelaide-based operator of non-surgical skin clinic network SILK Laser Australia (ASX: SLA) has today completed a $52 million acquisition of Australian Skin Clinics Group (ASC Group), expanding its network by 55 clinics and giving it a presence in the New Zealand market.

The acquisition, announced in June, was backed by a $20 million placement which resulted in the issue of approximately 4.7 million new shares sold at a 5.1 per cent discount.

It includes both Australian Skin Clinics and The Cosmetic Clinic in New Zealand, bringing SILK’s network to 118 clinics (including 14 in NZ), inching the new owner closer to its medium-term goal of 150 clinics.

The sale involved an upfront cash consideration of $47 million and up to an additional $5 million earn-out in scrip, subject to certain conditions.

“We’re delighted to welcome the ASC and TCC teams to SILK, and excited by the growth potential we see for our combined businesses,” SILK CEO and co-founder Martin Perelman said.

“With growing revenues, healthy margins, profitable operations and growing cashflows, SILK is in a unique position to support our growing loyal customer base, build exciting careers for our franchise owners, nurses and other team members, and deliver sustainable growth in shareholder value.”

When announcing the purchase back in June, SILK said it would turn the company into the number two player in the Australian non-surgical aesthetic industry, providing scaled entry into Victoria and New Zealand.

On a standalone basis, ASC Group is expected to contribute Pro Forma EBITDA in the first full year of $4.9 million to SILK.

The sale comes just over two years after Gold Coast-based businesswoman Deb Farnworth-Wood sold ASC for an undisclosed amount.

ASC founder Farnworth-Wood built the business to become one of the country's largest franchises with a turnover of $70 million despite starting with only a single Ashmore clinic in 2007.

Farnworth-Wood earned her stripes as Gold Coast Businesswoman of the year in 2017 and EY's Entrepreneur of the Year finalist in 2016.

During her tenure, Vogue also lauded ASC as one of Australia's top five medispas for three years on the trot.

 

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