Join our daily newsletter At The Bell to receive exclusive market insights
- Health, beauty and wellness product supplier McPherson’s (MCP) enters a series of formal agreements with Chemist Warehouse Group (CWG)
- The brands include Wagner Vitamins, Wagner Body Science and Microgenics and will be made available to customers within McPherson’s distribution network
- McPherson’s will be appointed as Chemist Warehouse’s exclusive long-term distributor of a select portfolio of Chemist Warehouse-owned or controlled health and beauty brands
- The distribution rights will be for an initial five-year term beginning on July 1 with McPherson’s having three five-year options to extend
- McPherson’s shares were up 6.74 per cent at 95 cents
Health, beauty and wellness product supplier McPherson’s (MCP) has entered a series of formal agreements with Chemist Warehouse Group (CWG).
Under the agreements, CWG will deliver material commercial and operational benefits to McPherson’s.
McPherson’s will be appointed as Chemist Warehouse’s exclusive long-term distributor of a select portfolio of Chemist Warehouse-owned or controlled health and beauty brands.
The brands include Wagner Vitamins, Wagner Body Science, Bondi Protein, Foster Grant, INC and Microgenics and will be made available to customers within McPherson’s distribution network.
Chemist Warehouse will increase the portfolio of McPherson’s brands which it
currently stocks in Australia and New Zealand, to include Moosehead, Maseur,
Fusion Health, Stratton, Sugar Baby and Happy Flora. Chemist Warehouse will also recognise McPherson’s as a preferred supplier.
“We are particularly excited about the opportunity for McPherson’s to be the long-term custodian and exclusive distributor of our portfolio of Chemist Warehouse owned or controlled health and beauty brands outside of the Chemist Warehouse Network,” Chemist Warehouse Chairman and Co-Founder Jack Gance said.
“This distribution arrangement will allow us to invest more heavily in marketing and advertising to grow the sales of these products.”
The distribution rights will be for an initial five-year term beginning on July 1 with McPherson’s having three five-year options to extend, subject to certain minimum performance thresholds on a brand-by-brand basis.
As part of this agreement, Chemist Warehouse will be issued roughly 14.1 million McPherson’s shares to become a substantial shareholder in the company with a 9.9 per cent holding.
The shares will be priced at 88 cents each and will be escrowed for a period of two years.
“The strong support to be provided by Chemist Warehouse for our core brands as well as the incremental ranging in-store and online for our other health and beauty brands is expected to accelerate our growth domestically as well as internationally through Chemist Warehouse’s physical and e-commerce platforms,” McPherson’s Chairman Ari Mervis said.
“Further, the ability to sell the Chemist Warehouse owned or controlled health and beauty brands through McPherson’s distribution channels is highly complementary and synergistic to our existing capabilities.”
McPherson’s shares were up 6.74 per cent with shares trading at 95 cents at 1:21pm AEDT.
