Billionaire Andrew Forrest is positioned for a potential takeover of BWX, as the struggling beauty group confronts the prospect of being forced to buy out celebrity Zoë Foster Blake’s skincare brand at a price that exceeds its own valuation.
Forrest’s private investment group Tattarang, announced on Wednesday that it has lifted its stake in BWX to 19.9 per cent – just short of the threshold which would require it to launch a full takeover bid for the company. The stake increase comes after Tattarang helped the company raise cash to pay down its debts and help ease bank covenants on its loans.
BWX said last week that it will to cut the book valuation of its assets including its 51 per cent stake in Foster Blake’s Go-To brand, sell underperforming businesses, and purge its entire board of non-executive directors, including chairman Ian Campbell.
Zoë Foster Blake, who sold 50.1 per cent of her Go-To Skin Care business to BWX last year for $89 million, may be the only person to emerge unscathed from its recent turmoil. Credit:Kristoffer Paulsen
Tattarang will get a seat on the company’s board. But chief investment officer John Hartman would not be drawn on any further plans the fund has for BWX.
“BWX is a long-term investment for Tattarang and we’re proud to support a growing Australian company, that manufactures here in Australia,” he said.
Entrepreneur and author Foster Blake made headlines last year when BWX – the company behind consumer skincare brands like Sukin – agreed to acquire 51.1 per cent of her business Go To for $89.9 million.
The deal included an option to sell the remainder of the business to BWX as early as September 2024. The value of the option is recorded in BWX’s accounts at $93 million, but the sale price depends on a valuation of the Go-To business at that time. BWX rose 16 per cent to close at 78¢ on Wednesday, giving it a market value of $143 million.
BWX chief executive Rory Gration told investors last week that Foster Blake’s option to sell the remaining 49.9 per cent of Go-To to BWX was one of the crucial reasons for the drastic restructuring plan.
“That’s a critical reason to get net debt down as soon as possible,” Gration said. “We can’t just ignore it and deal with it in two years time.”
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