“Madara Cosmetics” will separate the assets of the “Mossa” brand to the Finnish “Transmeri Ab”

The cosmetics manufacturer JSC “Madara Cosmetics” will separate the assets of the “Mossa” brand from the Finnish “Transmeri Ab”, according to the company’s statement to the “Nasdaq Riga” stock exchange. The total compensation amount is four million euros, and the deal is planned to be concluded on Tuesday. Considering the participation of “Transmeri Group Ab” in the capital of “Madara Cosmetics”, it is considered that this transaction was made with a related party.

The company states that “Madara Cosmetics” has signed a binding agreement with “Transmeri Ab” for the separation of assets of the “Mossa” brand and the provision of further contract manufacturing. The representatives of “Madara Cosmetics” note that since the introduction of the “Mossa” brand in 2014, its sales have mostly made up about 10% of the total turnover. Also, the company states that the transaction will ensure further growth of the “Mossa” brand in the Finnish market, while increasing the volume of contract manufacturing. The company will continue to provide Mossa’s product development function.

“The efficient use of the company’s resources is critical to the creation of long-term value for shareholders. This transaction not only allows us to focus more on our core strengths – the implementation of Madara’s long-term corporate and brand strategy – but also confirms the company’s ability to create valuable brand assets.” Special attention will be paid to building awareness of the “Madara” brand in France, Germany and Sweden,” says Gunta Schulte, executive director of “Madara Cosmetics”.

Also, the company notes that, taking into account the high liquidity indicators of the balance sheet before this transaction, the company’s management will continue to evaluate various options for efficient use of capital for future investments, including but not limited to further entry into new markets and diversification perspectives, especially in European markets, which are ” Home region of the Madaras brand. Additional brands are also planned to be created and developed using the “brand lab” concept.

At the same time, the representatives of “Madara Cosmetics” emphasize that the management maintains the previous guidelines, which expect to achieve at least a 10% increase in turnover in 2024 compared to the previous year, that is, to achieve a turnover of at least 22.25 million euros.

LETA already announced that the turnover of the “Madara Cosmetics” concern in the first quarter of 2024 was 5.5 million euros, which is an increase of 4% compared to the corresponding period in 2023. It was also reported that the turnover of the “Madara Cosmetics” concern last year, according to preliminary data, was 20.234 million euros, which is 8.2% more than in 2022, while the profit of the concern increased by 42.3% – to 1.595 million euros.

The company was registered in 2006, and its share capital is 377,058 euros. The largest owners of “Madara Cosmetics” are Uldis Iltners (23.92%), Lote Tisenkopfa-Iltner (23.76%), Finnish “Transmeri Group Ab” (22.93%), Liene Drāzniece (6.79%) and Zane Tamane (6.35%). “Madara Cosmetics” shares are listed on the “First North” alternative market of the “Nasdaq Riga” stock exchange.