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Essity Buys Modibodi and Knix to Become the Global Leader in Leakproof Apparel

July 12, 2022
July 12, 2022
Knix

In March, Kimberly-Clark Corporation, the pioneer of menstrual hygiene products, acquired a majority stake in Thinx. Now the world’s second-largest consumer tissue maker, Essity has agreed to acquire Australian Modibodi and to buy 80% of Canadian Knix Wear, strengthening its position in leakproof apparel.

WHO: Modibodi, founded in 2013, provides leakproof apparel for periods and incontinence, including underwear, swimwear, activewear, and maternity wear. The company is a leader in leakproof apparel in Australia, New Zealand, and UK markets, operating an online, direct-to-consumer business model, with growing sales in retail and through e-tailers. The business has 45 employees and is headquartered in Sydney, Australia.

Knix was founded in 2013 by CEO Joanna Griffiths with the mission to redefine intimates. Knix and their teen brand, Kt by Knix, offer a broad assortment of intimate apparel with leading positions in the growing leakproof apparel category. The company has a strong presence in the US and Canada and sells mainly direct-to-consumer through online channels, supplemented by six Knix retail stores. Knix has approximately 200 employees and headquarters in Toronto, Canada.

Essity is a global hygiene and health company headquartered in Stockholm, Sweden. The product portfolio contains one-use products such as tissue paper, baby diapers, feminine care, incontinence products, compression therapy, orthopedics, and wound care.

WHY: The transactions will make Essity the global market leader in leakproof apparel, the fastest-growing product segment in intimate hygiene, which includes feminine care and incontinence products. Essity is predicting the market segment will grow by more than 20% annually over the next five years, excluding Asia.

IN THEIR OWN WORDS: "The acquisition of Modibodi strengthens Essity's position in leakproof apparel and enables faster growth within better-for-you, better-for-the-planet solutions. Modibodi has the qualities we are looking for with leading market positions, strong brand and sustainability credentials as well as excellent digital marketing and e-commerce capabilities," says Magnus Groth, President and CEO of Essity.

"I am proud of all we have created at Modibodi over the past nine years and pleased that Modibodi is joining Essity. As a global leader in hygiene and health, Essity can provide the expertise and capital to take the brand forward during its next phase of growth, and achieve even greater impact," says Kristy Chong, founder and CEO of Modibodi.

"I am delighted to welcome Knix to Essity. It's a successful company with an impressive track record. Essity is now becoming the global market leader in leakproof apparel, which is an important step towards our goal of being the world's fastest growing company in Intimate Hygiene, providing increased well-being for customers and consumers," added Groth.

Details:

  • Essity acquired Modibodi for $93.1 million on a cash- and debt-free basis and will buy 80% of Canada's Knix Wear for $313 million. Joanna Griffiths will hold the remaining 20% share and will stay on as President of Knix. The total enterprise value of Knix is $400 million.
  • In 2021, Modibodi reported net sales of AUD 56.7MM and sales growth of 18%. The EBITDA amounted to AUD 5.7MM and EBITA to AUD 5.6MM. Gross margin was high and the EBITA margin amounted to 9.8%. 
  • In 2021, Knix reported net sales of CAD 133.6MM and sales growth of 97%. The EBITDA amounted to CAD 13.8MM and EBITA to CAD 13.4MM. The gross margin was high and the EBITA margin amounted to 10%. 
  • Essity is already active in the leakproof apparel market within feminine care with brands such as Libresse, Bodyform, Saba, and Tom Organic, and within incontinence products with the Tena brand.
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