Discount Supplements acquired by GNC Holdings
The acquisition was funded with cash although the terms of the deal have not been disclosed.
Following the acquisition, Discount Supplements will continue to operate as a separate business as will GNC’s other online outlet Lucky Vitamin.
Joe Fortunato, GNC's chairman, president and chief executive, said: "Discount Supplements offers a broad selection of competitively priced proprietary and third party products, and is a leader in the UK's sports nutrition market. This market – estimated to be £300 million – has demonstrated consistent double digit growth, which is forecasted to continue. The on-line channel has captured nearly one-third market share, and is growing faster than the market overall.
“Entering the UK and other key European and Scandinavian markets are core elements of our strategic plan to expand GNC's global reach. With this acquisition, we are well positioned to capitalize on the fastest growing channel in Europe's top market.”
GNC said the acquisition of Discount Supplements would also enable it to introduce premium GNC sub-brands in the sports nutrition, vitamin and diet categories into the UK and other markets.
Discount Supplements, which was founded in 2004, is expected to grow to approximately £20 million in revenue in 2013, and generate positive EBITDA margin. GNC expects the acquisition to be earnings neutral in 2013, as the EBITDA contribution is offset by deal costs and amortization of intangibles.
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