Bubs secures vital stocking deal with Woolworths
Written on the 5 February 2018 by David Simmons
Infant formula producer Bubs Australia (ASX: BUB) has secured an important stocking partnership with one of Australia's major supermarket chains.
Bubs' Infant Goat Milk Formula will be the company's first product sold in Woolworths supermarkets, as it intends to gradually expand its product offering.
The listed formula producer will sell all three stages of Bubs Advance Plus+ Goat Milk Infant Formula in selected Woolworths products, which CEO Nicholas Simms says is a massive coup for the company.
"Woolworths' commitment to partner with genuine Australian producers, and respond to the rising demand and awareness of the digestive and nutritional benefits of goat dairy, including infant formula, should be commended," says Simms.
"Goat dairy and infant formula is experiencing rapid growth domestically and overseas. Woolworths ranging of Bubs Australian made goat milk formula will only further enhance the appeal to consumers both in Australia and internationally in China and South East Asia."
In November 2017 Bubs Australia acquired NuLac Foods, a major producer of goat milk powder, to become Australia's only vertically integrated producer of goat infant formula.
The deal, worth up to $39 million, saw Bubs acquire 100 per cent of NuLac, the owner of the CapriLac and Coach House Dairy brands, and a 49.9 per cent equity interest in the dairy facilities producing NuLac Foods products.
Simms says Bubs' NuLac products differentiate the group from its competition.
"Bubs pathway to provenance through its strategic acquisition of NuLac Foods to become Australia's only vertically integrated producer of goat milk infant formula guarantees sustainable supply and control over our key base ingredient and capacity to meet growing future demand, which is a key differentiator for Bubs versus other offerings in the market," says Simms.
Bubs anticipates its products will be available at selected Woolworths supermarkets in April 2018.
Shares in Bubs Australia are up 2.07 per cent to $0.74 per share.
Business News Australia
Author: David Simmons