Metagenics Inc Acquires Nutri Advanced

BCL provided legal advice to the shareholders, alongside Dow Schofield Watts who provided corporate finance advice.

Nutri Advanced is a UK business based in Whaley Bridge, High Peak, and is a leading online retailer in nutritional supplements. The company employs 40 staff and develops and supplies various high-quality nutritional supplements to consumers and practitioners across the UK and Ireland, primarily through its own eCommerce portal. Its innovative products, together with its education and training offerings, have made the company a market leader. Following the transaction, owners Ken Eddie and Gary Courtenay have exited the business.

Metagenics is a US-based company backed by private equity firm Gryphon Investors. Its acquisition of Nutri Advanced comes as part of its strategy to have a direct presence in “all major EMEA countries”, according to Vice President Stijn Oste.

BCL’s experienced corporate team provided legal advice to the shareholders from the initial approach through to successful conclusion of the transaction. BCL’s team was led by Partner Piers Dryden alongside solicitors Shaun Little and Jack Trickett, with support from paralegal Millie Brookes.

Lawyer Monthly had the pleasure to speak with Piers Dryden, Partner at Beyond Corporate Law to give us some further insight into this transaction:

What matters did you assist the shareholders with during the acquisition?

We advised the shareholders on the transaction process, the key terms of the transaction documents and how to manage their liability with respect to the contractual protections that they provided to the buyer. Throughout the process, we interfaced closely with DSW and the shareholders’ tax advisors, to ensure that the client had a 360-degree view of the transaction and its implications for them and the company.

Did you encounter any challenges along the way? If so, how did you overcome them?

Given that the buyer was a PE-backed US entity, part of our role was to align the buyer’s and its backers’ expectations with respect to the transaction terms with typical UK midmarket transaction terms, particularly with respect to warranty protection and liability caps.

We therefore worked hard to foster a highly collaborative negotiation process, to make sure that we could meet everyone’s expectations, which were all different. In this regard the negotiation was assisted by the fact that Metagenics was a supplier of Nutri – so they knew each other’s businesses very well, and there was already a strong cultural synergy between the two businesses.

Throughout the process, we interfaced closely with DSW and the shareholders’ tax advisors, to ensure that the client had a 360-degree view of the transaction and its implications for them and the company.

What impact do you expect this deal to have on the nutritional supplement industry in the UK and internationally?

It is fair to say that Nutri has been and continues to be something of a trail blazer in the nutritional supplement industry in the UK. Nutri was responsible for huge growth and acceptance of nutritional supplements for health and wellbeing purposes, and we expect that with the backing of Metagenics, Nutri will be able to continue to increase its influence in this respect.

How does your work on this deal fit the profile of your firm?

Our Corporate team has always focussed on long-term relationships with entrepreneurial management teams and shareholders, supporting them through all stages of their business life cycle. A deal like this generally represents the pinnacle of such a client’s business achievements, and it was a real privilege to work with Ken and Gary to see them reap the rewards for a business that was built over a long period.

We have a strong reputation in the region for providing ‘large law firm’ quality of advice with appropriate commercial aptitude, and with very many years of experience of doing so behind us, we integrate our advice efficiently with the wider Group of professionals working on a transaction. Our aim is always to focus on the respective clients’ real commercial drivers, and not scoring points against our opposite numbers. On deals like this, we strongly believe that this pragmatic and commercial ‘can-do’ approach reflects how our clients want us to behave.

Do you expect to see any similar deals come through this year?

Yes, in an M&A market that remains strong, we are currently taking on a number of sale mandates from a variety of clients and businesses. Our M&A work is a fairly even split between acting for sellers and buyers, but certainly we are seeing a number of business-owners and corporate groups coming to market looking to make disposals – whether on retirement, for strategic purposes or for other reasons.

What else are you working on in 2022?

Most of our corporate work is focussed on M&A with deal sizes ranging from £5m to £50m, albeit we currently have some larger work in our pipeline for 2022. That said, we have a diverse range of other instructions – joint ventures and equity restructuring exercises are areas that have been highly active this year.

With this strong pipeline, and to service demands from existing and new clients, we have a key focus at present on continuing to grow and develop the talent in our corporate team. We have increased our headcount by 167% in the last 12 months, two of our paralegals have recently been offered training contracts with the Group and we are looking to make further recruits into our team at a variety of levels in the next 12 months.

It is a privilege to be working in a team with these growth aspirations, and to work on deals of the quality of the Nutri transaction. Above all, we are delighted to see the success of this deal both for Ken and Gary, but also for the Metagenics team. Truly a team effort by everyone involved.