Venture Life gets into the mouthwash business

Venture Life was getting itself into the mouthwash business on Friday, announcing the proposed acquisition of Periproducts, and a placing and bond issue to fund the deal.

The AIM-traded consumer healthcare group, with a focus on the self-care needs of the ageing population, said the deal was worth a cash consideration of £5.6m.

To help fund the acquisition, Venture Life proposed a placing of up to 2,428,572 new ordinary shares of 0.3p each in the capital of the company, representing 7.1% of its existing ordinary share capital, to raise up to £1.7m.

It also proposed a convertible bond issue to raise up to £2m, of which £1.5m had been underwritten.

The placing and the acquisition were subject to shareholder approval, with the acquisition in turn conditional on completion of the placing and convertible bond issue.

"The product range of Periproducts is a premium range in the medicated mouthwash category, and significantly strengthens our oral care portfolio," said CEO Jerry Randall.

"The products hold a strong position in the UK pharmacy channel, and have been present there for over 15 years. However, there has been limited internationalisation of the range and, as this is an area of expertise for the group, we expect to grow the international presence of this brand significantly," he added.

Periproducts recorded turnover of £2.8m and an operating profit of £0.2m in the year to 20 November 2015, the company reported.

On a cash and debt-free basis, the headline consideration represented a multiple of 1.4x Periproducts' turnover for that year.