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EDMONTON, Alta. -- Planet Organic Health Corp., based here, which owns and operates large natural food supermarkets under the Planet Organic Market banner, in addition to a chain of natural health outlets across Canada under the Sangster's Health Centres banner, said yesterday that it has completed its acquisition of health food store chain Newfound Health, also based in Edmonton, which has 14 franchise locations in the province of Alberta.
Three nonperforming locations were removed from the deal before closing, according to Planet Organic. Newfound Health president Azim Velji will remain to offer consulting and management assistance to Planet Organic during the transition. According to Newfound Health, "This is an excellent move for our group of stores. It provides us with a valuable exclusive private label to assist us in reaching the next level."
The chain will operate under the Sangster's division, run by Roy Sangster, who noted: "We're glad to have the Newfound Health chain under our umbrella. It will add significant revenue and more bottom line to our existing operations, while providing them with access to our exclusive Sangster's brand of products."
"The Newfound Health acquisition represents another strategic move for Planet Organic," added Planet Organic c.f.o. Darren Krissie. "With more stores and a stronger presence in Alberta, we will continue to build our revenues, increase our buying power, and offer our customers a wide range of healthy organic and natural living products. We look forward to expanding our team to include the experienced and professional franchisees and staff at Newfound Health."
The final purchase price was $1.0 million (U.S. $822,414.18), with $500,000 in cash, $400,000 in vendor take back financing over three years, and the balance via the issuance of 90,909 shares. The transaction is arms length and will not result in change of control of Planet Organic, according to the company, which in just a little more than four years has gone from one small market store to over 50 locations.