ASX-listed Wellnex Life has signed a binding agreement to purchase topical pain relief brand Pain Away Australia for A$22 million.
CEO George Karafotias described the move as "perfectly aligned" to the firm's medicinal cannabis strategy and focus on pain relief.
Pain Away's product range targets muscle and joint pain and includes sprays, creams, roll-ons and patches. The brand posted revenue of $12.4m in FY22 and is forecast to generate $13.7m in the current financial year.
Founded in 1999, Pain Away counts more than one million Australian customers and is stocked in over 6,000 pharmacies nationwide. The brand has also been expanding into international markets, with a presence in New Zealand, China, Hong Kong, Taiwan, Singapore and Malaysia.
Wellnex said the deal strengthens its position in the consumer healthcare industry and immediately adds scale to its existing portfolio.
The company plans an equity raise to finance the transaction, which includes $1.15m of inventory at cost and will be settled in cash, subject to the satisfaction of certain customary conditions by no later than July 31.
Karafotias added: "Pain Away is a well-known and growing brand that has consistently achieved strong revenue growth and high gross margins.
"What is really exciting… is the opportunity to accelerate growth of the existing portfolio into grocery and international markets, while extending the brand into new categories in the market, such as pet health.
"The brand is also perfectly aligned to our medicinal cannabis strategy with our focus on pain relief."
Wellnex has a pipeline of medicinal cannabis products it expects to bring to the Australian market this year. Through a deal with OneLife Botanicals, the company is developing a low-dose CBD soft-gel capsule aimed at pain treatment.
