Hydration Pharmaceuticals Company (ASX:HPC) announcement

Hydration Pharmaceuticals Company Limited (ASX:HPC) has successfully divested its non-US assets to Prestige Consumer Healthcare Inc, generating proceeds of approximately US$9.5m (~A$13.7m). The sale enables the full repayment of the A$8.2m debt facility while providing new capital to drive sales and margin growth from the continuing US operations.

Executive Commentary on Prestige Transaction

This transaction represents the best available outcome for our investors and key stakeholders, following the Board's decision to seek a sale transaction. Importantly, the Company has freed up capital to extinguish its debt, with additional cash to deploy to accelerate growth in the US market, which is the largest consumer opportunity of all the Company's current and former territories. Hydralyte US has an established footprint in the lucrative US market through both ecommerce and physical store network channels, and we look forward to executing on a more streamlined business strategy to unlock shareholder value.

Summary of Hydration Pharmaceuticals Company (ASX:HPC) Announcement

Hydration Pharmaceuticals Company Limited (ASX:HPC) has successfully completed the divestiture of its non-US assets to Prestige Consumer Healthcare Inc, generating proceeds of approximately US$9.5m (~A$13.7m). The sale price represents a significant premium over HPC's market capitalization. The company will utilize the funds to fully repay its existing A$8.2m debt facility and advance operations in the US market, focusing on achieving scale and cashflow breakeven. The US growth strategy will be underpinned by a significant increase in balance sheet strength, with no debt and a stronger cash position to flexibly pursue targeted opportunities for sales and margin growth. Management has also identified several opportunities to reduce working capital and operating costs, reflecting the reduced size of the business, which will be implemented in the near term.