After adding the Hobby Warehouse Group, which includes ecommerce businesses Toys”R”Us, Babies”R”Us and Hobby Warehouse, to its portfolio in 2020, Funtastic has decided to sell its confectionery business.
In an effort to transform the business―including an overhaul of existing portfolios, introduction of new products and expansion of its ecommerce focus, and exploring inorganic growth opportunities in emerging growth sectors―the company will offload the confectionery side to Sweet Season.
“The sale of the confectionery business is part of the ongoing strategic review of all product ranges, customer segments and operations,” explains Louis Mittoni, CEO and managing director of Funtastic.
Sweet Season will be paying $1.05 million for the business comprising current inventory and all other assets of the confectionery business including confectionery brand names and other intellectual property.
“It accelerates materialisation of value for part of the business and will allow investment to build scale and to right-size the business, aligned with the planned growth and focus of the company to deliver our mission of encouraging children to engage with as many forms of play as possible and assist people to explore, create and live life more fully,” says Mittoni.
Revenue of the confectionery business for the year ended 31 July 2020 is $4.2 million, which represents 17.1 per cent of the FUN audited total revenue for the year ended 31 July 2020 and approximately eight per cent of the pro forma full year revenue of the new FUN group post acquisition of the Hobby Warehouse Group.
The sale is expected to be finalised prior to the end of the financial half year on 31 January 2021.