Where-to for Go-To? New owner sought for Zoë Foster Blake’s skincare brand after BWX collapses
Challenged cosmetics group BWX has called in administrators, while Zoë Foster Blake’s Go-To skincare continues its search for a new owner.
Administrators for collapsed cosmetics group BWX will continue a search for a new owner for Go-To, the skincare brand founded by Zoë Foster Blake, after the ASX-listed group called in external managers on Monday evening.
The BWX board informed the market on Monday that its Australian operations have been placed in voluntary administration, with Kate Warwick, Joe Hansell and Kelly Trenfield from FTI Consulting appointed as administrators.
BWX is home to well-known beauty brands including Sukin, which is currently sold through Chemist Warehouse, Coles and Woolworths, and was funding Purely Byron, a beauty brand co-founded by model Elsa Pataky and backed by her husband Chris Hemsworth, which collapsed in March. Eco-focused platforms Flora & Fauna and Nourished Life also form part of the BWX portfolio of brands.
The administration does not include Go-To, which BWX bought a 51% controlling stake of in 2021 for $89 million. BWX also does not manufacture Go-To products.
According to reports, BWX has been in breach of debt covenants since November and was attempting to refinance loans with Commonwealth Bank. On Monday, it became clear these discussions were not successful and trading in BWX shares was suspended while the future of the company was decided.
This came less than 12 months after billionaire Andrew Forrest’s private investment group Tattarang increased its stake, to close to 20%, in the challenged BWX business, which has seen its chief executive, chief financial officer and chairman all depart during the past 12 months.
In February, BWX reported a $100.8 million loss for the six months to December 31, compared to a $5.4 million loss in the previous six months period. The interim results showed revenue fell by 18.4% to $79.7 million.
Trading in BWX shares will remain suspended during the administration process, and the company will continue to operate on a “business-as-usual” basis.
On Monday, BWX said it had been hit by “customer destocking and inventory and working capital issues”.
“The directors believe entering voluntary administration will help progress the restructuring process already underway with new management at BWX and give the company the best chance of future profitability,” the company said in a statement.
BWX had already been seeking a buyer for Go-To, which is run independently from the wider BWX group, and this process will continue under the management of administrators.
“The directors have been actively working to find a compatible buyer for BWX’s 50.1% shareholding in Go-To. The administrators intend to continue this sales process,” said BWX in a statement.
“Go-To is run and managed independent of BWX, with a wholly separate treasury function as well as separate cash flow management, including accounts payable.”
Foster Blake founded Go-To in 2014 and has developed a loyal following for its peach-coloured skincare products, which also includes its Bro-To range pitched at men, and Gro-To for children. As part of the acquisition deal in 2021, the founder, along with other investors, can choose to sell their remaining 49.9% stake to BWX from next year.
The Nine papers report such a sale could now generate $59.2 million, which is substantially lower than the rumoured floor price for the put option of around $93 million suggested in 2022.
Earlier on Monday, Go-To said in a statement that it has “no financial, manufacturing or supplier affiliations with BWX”.
The brand, which has recently ventured into Europe via German retailer Douglas, is celebrating its ninth birthday this week with customer giveaways.
“The Go-To business is in a strong position with year-to-date performance seeing double-digit growth,” the company said.
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