Evolear

Stockholm - December 4, 2024

Evolear Plans Strategic Acquisition of Solution International
Evolear has signed a Letter of Intent (LOI) to acquire Solution International ("Solution"), a well-established company in the child products sector. The proposed purchase price amounts to a total of SEK 160 million, to be financed through the issuance of 38,571,429 Evolear shares at a price of SEK 3.50 per share and a promissory note of SEK 25 million with a three-year term at an annual interest rate of 5%. The interest will be paid upon loan repayment.

Next Steps in the Process
The signing of the LOI marks a significant milestone in the acquisition process. Evolear will now begin a comprehensive due diligence (DD), finalize negotiations, and draft binding agreements for the transaction. The acquisition is expected to be completed during Q1 2025.

Revenue and EBITDA for Solution
Solution International boasts a strong financial position, with projected revenue for 2024 of approximately SEK 140 million and an EBITDA margin of 14.7%. This solid profitability is the result of the company’s focused strategy on product development, quality control, and international distribution. For the coming year, the company is expected to further enhance its financial performance, with forecasted EBITDA of GBP 2.1 million (approximately SEK 28 million).

For Evolear, this acquisition is a key step in its strategic growth plan, positioning the group to achieve profitability as early as next year.

Strategic Advantages of the Acquisition
Solution International is a leading player in the development of private-label and licensed products for children and parents, offering a wide range of products from feeding equipment and hygiene items to licensed merchandise featuring popular brands like Peppa Pig and Paw Patrol. The company has established close partnerships with major UK retailers and a global network of customers and suppliers.

Through this acquisition, Evolear expands its offerings from primarily digital to encompass both digital and physical channels, creating an omni-channel strategy expected to enhance customer experiences and generate strong synergies between the two companies. The acquisition also strengthens Evolear with an international network and faster access to new markets.

Solution’s Future Growth Plans
Solution has a clear and focused strategy for continued expansion. The company sees significant opportunities in future acquisitions of complementary businesses within the same sector, aiming for rapid international growth. This strategy aligns seamlessly with Evolear’s ambition to establish itself as a leading group in products and services for children and families.

Ownership Structure Post-Transaction
Following the completion of the transaction, Solution's founder and current owner, Mark McLoughlin, is expected to hold 89.65% of Evolear. This reflects Solution's importance and strategic value to Evolear.

Comment from Evolear’s Management
"The acquisition of Solution is a milestone for Evolear. It strengthens our market position and provides us with the opportunity to offer innovative products and solutions to a broader customer base. We are particularly excited to collaborate with Solution to realize synergies and create long-term value for our shareholders," says Evolear’s CEO.

Next Milestone
We are now proceeding with a thorough due diligence process and are working towards completing the transaction in Q1 2025. We look forward to announcing further progress and details as we reach new milestones.

This information is information that Evolear AB (Publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out below, at 12:14 CET on December 4, 2024.