Cosmetics firm Warpaint London has announced the acquisition of fellow beauty brand specialist Brand Architekts.
Warpaint London, the company behind makeup brands W7 and Technic, told markets today it has reached an acquisition agreement for the entirety of issued and to be issued share capital of the Brand Architekts.
The company said under the terms of the acquisition, each shareholder would receive 48p per share.
The acquisition values Brand Architekts’ entire issued, and to be issued, ordinary share capital at approximately £13.9m on a fully diluted basis—a premium of 100 per cent to the closing price of Brand Architekts’ share price on 4 December.
Separately, the company announced a placing and retail offer to raise £14m and £1m respectively.
Warpaint London looks to boost growth
It comes as Warpaint London looks to take on an “exciting and relatively low risk” investment to boost growth opportunities in the new year.
Sam Bazini, chief executive of Warpaint, said today’s proposed acquisition of the firm is an “attractive strategic opportunity” as its brands complement its already existing portfolio.
“Additionally, as part of a larger group we believe applying our established supply and distribution channels and approach to Brand Architekts will improve efficiency, reduce costs and drive profitability,” Bazini said.
Warpaint London told the market in September that trading in 2024 had been in line with expectations, with a particularly strong performance in the US where it benefited from a larger Walmart order.
It added that it was also in “talks with other large new retailers in Europe, the US and the UK with a view to stock the group’s products.”
In 2025, management said it expected to report further growth with the rollout of W7 colour cosmetics into a significant number of new Superdrug stores as well as a 150-store expansion of the Group’s W7 impluse offering in Tesco stores.
However, in October, Brand Architekts reported a fall in sales as it pivoted to fewer, bigger brands.
The firm reported an underlying loss of £0.4m compared to a loss of £1.2m for 2023, while its gross profit margin increased by 1.5 per cent to 41.2 per cent.
Sales for the year ended 30 June were £17m, down 15 per cent from £20.1m in 2023.
Roger McDowell, chair of Brand Architects, said the board “recognises the certainty of value” of the cash offer, especially during an uncertain economic environment.
McDowell added: “The acquisition will strengthen the enlarged business for the benefit of all our customers, employees and other stakeholders.
“The Brand Architekts directors believe this Acquisition is in the best interests of its shareholders and as such are unanimously recommending the Acquisition to its shareholders.”