Supreme poised to join AIM through £67.5m flotation
We were delighted to work with our long-standing client Supreme, the battery and vaping specialist, as it announced its entry on to the AIM market today, in a flotation worth £67.5m.
The firm, run by high-profile businessman Sandy Chadha, initially announced its intention for an IPO almost three years ago. Unveiling its move today, it said it expects dealings in its share will start on February 1, under the ticker SUP.
Following the float, Supreme’s market capitalisation is expected to be approximately £156.1m.
It said the placing saw strong demand from institutional investors, and added that £7.5m of the gross proceeds raised will be used to partially repay the group’s existing debt, as well as £60m to pay the selling shareholders, including Sandy Chadha who will retain a substantial shareholding in the group, amounting to approximately 56.8% of the shares in issue on admission.
The directors believe that the IPO will enable the company to execute on its growth strategy, raise its profile and provides the ability to incentivise key employees.
Jim said: “Supreme are one of our longest-standing client relationships. Seeing client businesses through their life-cycles to achieve growth and success such as this, is one of the best bits of our job. I’m absolutely delighted for Sandy and his team of people at Supreme, for whom this is the beginning of a hugely exciting new chapter. We’ll doubtless celebrate with them when lockdown permits, and look forward to continuing our close relationship as they move forwards as a PLC.”
“My congratulations to team who have all worked so hard on this deal,” added Beyond Group Head Matt Fleetwood, “which not only demonstrates the type of work undertaken by Beyond Corporate but is also testament to the character and talent of the people in the firm.”
Supreme supplies products across five key categories: Batteries, lighting, vaping, sports nutrition & wellness, and branded household consumer goods. Its capabilities span from product development and manufacturing through to its extensive retail distribution network and direct to consumer capabilities
A flotation enables the group to efficiently scale up new products, brands, and categories at low cost, as has been the case for vaping and sports nutrition & wellness.
In the year ended March 31, 2020, the company generated revenues of £92.3m, gross profit of £26.8m and adjusted EBITDA of £16.2m. For the six months to September 30, 2020, unaudited revenues were £56.3m with adjusted EBITDA of £8.4m, an increase over the prior period of 43% and 21%, respectively, demonstrating the company’s resilience through COVID-19.
The directors intend to pay dividends to shareholders in an aggregate annual amount equivalent to approximately 50% of net profits, retaining the balance of earnings from operations to finance the future expansion of the group, with dividends commencing – with an interim dividend – following the notification of the company’s interim results for the six month period to September 30, 2021.
Chief executive and founder, Sandy Chadha, said: “I am deeply proud of the business we have developed and believe our flotation on AIM will provide Supreme with the tools with which to capitalise on a number of exciting growth opportunities.
“We have created a profitable business of significant scale, underpinned by a platform which provides a seamless route to market for a number of leading brands and product categories. We have established leading positions across the battery, lighting and vaping markets.Coupled with our proven ability to innovate, with recent category entries such as sports and nutrition and branded household consumer g oods now contributing substantially to our financial performance, we have a clear path to maintaining sustainable growth.”
He added: “We welcome our new shareholders at what is a very exciting inflection point for our business.”