Ecoya buys growing 'green' skincare company

Ecoya had been working on the Trilogy deal for some time after being approached by the firm's owners. Photo / Supplied

42 Below founder and now candle maker Geoff Ross is trying his hand at the skincare market after his company Ecoya announced the acquisition of Wellington-based company Trilogy.

Ecoya bought Trilogy for $10 million with the promise of an earn out payment at the end of the 2011 financial year once the company's ebitda has been finalised.

The maximum payout will be another $10 million, of which $5 million will be paid in cash and the remaining $5 million in Ecoya shares.

The unconditional deal is being funded by the raising of new equity, through Ross' related company The Bakery Business and Craigs Investment Partners, and debt to be settled by next Friday.

Ross said Ecoya has been working on the deal for some time after being approached by the founders of Trilogy, sisters Sarah Gibbs and Catherine de Groot.

Ross said Ecoya would run the two brands independent of each other.

"We think it's a pretty smart move to have two horses in the race," ross said.

"When you're with one retailer, perhaps a competing retailer, it doesn't give you as much support for that brand because it's in a competitor's store. So by having two brands you can make sure you are well supported in all channels.

"Trilogy is a great New Zealand success story. It's a very healthy business and we're thrilled to now have it part of the Ecoya family."

One of the main reasons Ecoya acquired the skincare company is because it is already established and successful in the UK and Ireland, two markets Ecoya has yet to gain a presence in.

Ross said ultimately the market would judge whether buying Trilogy was a good move for the company, but he believes the acquisition will be good for shareholders and advance Ecoya's plans considerably.

"We think it's good value. It's a profitable business.

"It will mean Ecoya's own profit projections come forward considerably. It has a material impact effect on the top line and the bottom line growth for Ecoya. It really brings our own plans forward. It's a real leap for our own plans."

Trilogy is consistent with the clean green message Ecoya is banking on making a market for itself overseas.

Ross said the company produced "environmentally sound products" which was the highest growth commodity within the beauty, bath and body market. "Trilogy is a leader in Australasia and it shares similar views to us on natural ingredients and the emerging opportunities in the affordable luxury category.

"Our respective cultures also have much in common."

Ecoya shares closed unchanged yesterday at 80c.