The wholesale giant is acquiring them for $127.4 million, to build a strong service-based business ‘away from government funding’
Australian Pharmaceutical Industries has entered a binding agreement to acquire Clearskincare Clinics for $127.4 million, to be paid in instalments over three years.
Clearskincare Clinics is a provider of non-invasive aesthetic services including laser hair revmoval, skin treatments and cosmetics injectables, as well as an exclusive skincare product range.
Founded in 1997, the business has expanded from two clinics in 2005 to include 42 clinics in Australia and two in New Zealand.
API will initially acquire a 50.1% controlling interest in the clinic business and take 100% ownership of the skincare products business.
It will move to 100% ownership of the clinic business by September 2021.
The acquisition is “highly compelling and complementary” and will allow API to deliver a more diversified business with accelerated growth, says the company.
“The Acquisition fulfils our criteria for aligning with a robust business in a burgeoning sector of the health and beauty market, that is services-based and away from government funding, and to which we can add further value for customers, clinic teams and shareholders,” says API Managing Director and CEO Richard Vincent.
“We expect to build scale and profitability because of our operational capabilities in franchising, network development and consumer products management.
“Also, API’s Priceline Pharmacy business and Clearskincare Clinics share the same core customers, which will enable us to leverage our marketing assets across both businesses.
“This is the right-sized acquisition for API to build on and securing such a high-quality business to which we can add value will be a great addition for our customers and shareholders.”
In late April, API revealed half-year results that showed a 14.4% drop in reported net profit, which the company said was primarily due to challenging retail conditions.
“The group has undertaken a number of initiatives during the period to combat suppressed consumer sentiment, with an aim to provide improved sales trending and protect profit performance,” said API directors in their report.
“These include a number of in-store initiatives, product differentiation and a more streamlined Priceline/Priceline Pharmacy operational structure.”