DayDayCook Announces Agreement to Acquire 51% of Italian G.L. Industry S.p.A, a Specialized Asian Food Brand
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The strategic acquisition of G.L. Industry S.p.A by DayDayCook represents a significant step in the company's international market expansion, specifically into the European sector. This move is likely to enhance DayDayCook's market share and diversify its revenue streams, given the growing European interest in Asian cuisine. The deal leverages GLI's established distribution network across 7,000 European retailers, which could accelerate DDC's market penetration and brand recognition. The use of both cash and stock to finance the deal suggests confidence in the transaction's value creation potential and a balanced approach to capital usage.
From a market expansion perspective, the acquisition taps into the increasing consumer demand for convenience and ethnic foods. It is essential to consider the cultural integration of the brands and how DayDayCook's branding strategy will adapt to European consumer preferences. The success of this acquisition will depend on the effective management of cross-cultural business operations and the seamless integration of GLI's product lines with DayDayCook's existing offerings.
DayDayCook's acquisition of a 51% stake in GLI for $9.3M, paid over three years, plus additional contingent consideration, suggests a structured deal that mitigates upfront cash outlay and aligns future payments with GLI's performance. This structure could be favorable for DDC's cash flow management and reflects a performance-based investment strategy. The transaction's impact on DDC's balance sheet will be critical to monitor, particularly regarding how the stock component of the payment will affect shareholder dilution and earnings per share.
Investors should evaluate the acquisition's potential to contribute to DDC's long-term earnings growth. Given GLI's recent investments in state-of-the-art machinery and the reported $11M revenue in 2023, there is an indication of operational capacity for growth. However, assessing the sustainability of GLI's EBITDA margins in the context of DDC's overall financial health will be essential. The implications for DDC's stock performance will hinge on the market's perception of the acquisition's strategic fit and its ability to generate synergies.
The acquisition's adherence to customary closing conditions and legal notifications is a standard procedure in such international transactions, ensuring compliance with applicable laws and regulations. The involvement of Oaklins HFG China as a financial advisor indicates due diligence in the negotiation process and the structuring of the transaction. For stakeholders, the legal framework of the deal, including the terms of the acquisition and the future operational relationship between DDC and GLI, will be a foundational aspect of the partnership's success.
It is also noteworthy that the founder of GLI will remain as CEO, which may help in preserving the brand's integrity and continuity of leadership. However, this arrangement necessitates clear governance structures to align both companies' strategic objectives and operational practices. The legal intricacies of integrating two companies across different jurisdictions will require careful navigation to optimize the benefits of the acquisition while mitigating potential risks.
Acquisition grows DayDayCook’s global footprint with entry into European market for Asian ready-meals
NEW YORK, Jan. 10, 2024 (GLOBE NEWSWIRE) -- DDC Enterprise, Ltd., (NYSEAM: DDC) (“DayDayCook,” “DDC,” or the “Company”), a leading content-driven food consumer brand, announces it has entered into an agreement to acquire
GLI produces ready-to-cook and ready-to-heat Asian foods for retail outlets and catering customers. GLI sells its products to over 7,000 European retailers under private labels as well as under the GLI owned Asiamama and Sushimama brands. GLI recently invested substantially in state-of-the-art machinery and currently manages two production facilities, which will provide the capacity to grow its revenue, which was approximately
“Today’s announcement marks another significant milestone as the acquisition of GLI expands our growing footprint into the European market. It further underscores our commitment to expanding worldwide and in new markets bringing diverse culinary delights to our customers,” said Norma Chu, DDC’s Founder and CEO. “Cristian Lin, the founder of GLI, is a remarkable entrepreneur and has made an incredible contribution to promoting Asian cuisine in Italy over the years. Cristian will remain as the CEO of GLI, and I look forward to our collaboration as we continue to innovate and spread the joy of Asian cooking to more families in Europe.”
Cristian Lin, Founder and CEO of GLI added, “I believe the union between DayDayCook and GLI provides a unique opportunity for growth, as the business of ready-Asian meals in Europe is rapidly developing. The DayDayCook brand is one we are proud to become a part of.”
Oaklins HFG China served as exclusive financial advisor to DDC and advised DDC throughout the transaction.
About DayDayCook – A Leader in Food Innovation
Founded in 2012, DayDayCook is a leading content-driven consumer brand offering easy and convenient ready-to-heat, ready-to-cook and ready-to-eat Asian food products. The company focuses on innovative and healthy meal solutions with a fast-growing omnichannel sales network in China and the U.S., and through a strong online presence globally. The Company builds brand recognition through culinary and lifestyle content across major social media and e-commerce platforms.
About G.L. Industry
GLI produces ready-to-cook and ready-to-heat Asian food for retail outlets and HoReCa customers. Its product range includes spring rolls, various kinds of dumplings, Cantonese-style rice, almond chicken, Gongbao chicken, yaki udon, and other noodles, sauces, sushi, and sashimi. With Italian and European retailers and caterers as its customers, GLI sells its products under private labels and under the GLI owned Asiamama and Sushimama brands.
Forward-Looking Statements
Certain statements in this announcement are forward-looking statements, including, for example, statements about completing the acquisition, anticipated revenues, growth and expansion. These forward-looking statements involve known and unknown risks and uncertainties and are based on the Company’s current expectations and projections about future events that the Company believes may affect its financial condition, results of operations, business strategy and financial needs. These forward-looking statements are also based on assumptions regarding the Company’s present and future business strategies and the environment in which the Company will operate in the future. Investors can find many (but not all) of these statements by the use of words such as “may,” “will,” “expect,” “anticipate,” “aim,” “estimate,” “intend,” “plan,” “believe,” “likely to” or other similar expressions. The Company undertakes no obligation to update or revise publicly any forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and the Company cautions investors that actual results may differ materially from the anticipated results and encourages investors to review other factors that may affect its future results in the Company's registration statement and other filings with the SEC.
Contact:
Investors:
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Matt Blazei
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