- DS Group is an internationally operating brand and retail company with an annual turnover of more than €270 million (2021 forecast)
- Social Chain AG’s revenue forecast was raised to around €620 million for 2021 (pro forma consolidated)
- Synergy potential on an EBITDA basis: A total of €40 to €50 million in the first three years after the takeover
- Revenue target of one billion for the 2023 financial year
- Ralf Dümmel appointed to Social Chain AG’s Executive Board
- Share of Social Chain AG to be listed in the Prime Standard segment of the Frankfurt Stock Exchange in 2021
- Wanja S. Oberhof: "Social Chain and DS Group complement each other perfectly: The comprehensive brand and product portfolio of DS Group is predestined for our direct marketing to end customers via social commerce channels."
Berlin/Hamburg, 19 October 2021.
The Social Chain AG (WKN: A1YC99, ISIN DE000A1YC996) is facing the most important acquisition since its foundation. The social commerce business takes over 100 percent of DS Group, with its headquarters near Hamburg. DS Group is an internationally operating brand and retail company, currently offering more than 4,000 products. The group is successful in developing, marketing, and distributing its own products and brands. DS Group comprises more than 700 brands, registered designs, patents, and utility patents. One of its best-known brands is LANDMANN, the oldest German barbecue manufacturer. DS Group is among the major suppliers of goods for food retailers, discounters, drugstores, teleshopping, DIY stores, self-service stores, furniture shops, cash & carry, specialist retailers, department stores, as well as online marketplaces and mail order businesses in Europe. The group expects revenues of more than €270 million in 2021 and has a total of 550 employees.
The contracts for the acquisition of DS Holding GmbH were signed today. Social Chain AG will pay a total acquisition price of €220.5 million, comprising a cash and a share component. The cash component amounts to €100 million. The share component consists of 2.855 million new shares of Social Chain AG from authorized capital. Based on the Social Chain share’s closing price of €42.20 on 18 October 2021, the share component has a market value of €120.5 million. As a result of this non-cash capital increase, the number of shares issued by Social Chain AG will rise from 11.453 million to 14.308 million.
The shares of Social Chain AG are to be listed in the Prime Standard segment of the Frankfurt Stock Exchange in 2021. “This uplisting is now all the more reasonable with regards to our new sales volume and significant growth prospects,” says Wanja S. Oberhof, CEO of Social Chain AG. The company’s annual general meeting paved the way for its inclusion in the Prime Standard only a few weeks ago (see press release from 30 July 2021).
With its acquisition of DS Group, Social Chain AG expects total sales in the 2021 financial year to rise to €620 million (pro forma consolidated). By the end of the first half of 2021, the consolidated pro forma EBITDA was already at approx. €13 million. A similar business development is expected for the remainder of the year. Within the first three years after the acquisition, its EBITDA-effective synergy effects are expected to account for a total of €40 to €50 million. The number of employees at Social Chain AG rises to over 1,400. Social Chain AG expects significant growth from the integration of DS Group – and is already targeting a revenue of more than €1 billion for the 2023 financial year.
"Social Chain AG is building a leading social commerce platform on an international scale."
Wanja S. Oberhof says: "With the acquisition of DS Group, we are building a social commerce platform on an international scale. In the future, we will record significant growth in both Europe and the U.S. The DS Group's comprehensive brand and product portfolio is predestined for our direct marketing to end customers via social commerce channels. At the same time, the diverse distribution channels of DS Group strengthen the sales opportunities of Social Chain AG’s existing private labels. This means that we set up a comprehensive and modern multi-channel sales system with a clear social-first strategy for the future. It also makes Social Chain AG a strong partner for retailers when it comes to innovative products. The brands of the future will be increasingly shaped by social communities and must be available as broadly as possible across all distribution channels. A win-win situation for everyone involved."
DS Group currently offers around 4,000 articles from diverse product categories. Thanks to 122 deals that Ralf Dümmel, managing partner of DS Group, concluded in the startup show "Die Höhle der Löwen” (German version of the UK's "Dragons' Den" and "Shark Tank" in the U.S.), DS Group brought more than 300 products to market together with their founders. From its own logistics location in Mecklenburg-Western Pomerania, northern Germany, with more than 30,000 square meters of storage space, the company ships several million packages to end customers (B2C) every year and supplies more than 40,000 stores across Europe (B2B).
"We will demonstrate how perfect cooperation between retail and social commerce works."
Ralf Dümmel, Managing Partner of DS Group, says: "For us at DS Group, this deal is a bridge to the future. We are happy to gain new strengths in addition to our strong retail expertise. The social media and e-commerce expertise of Social Chain AG consistently complements our successful business. As part of Social Chain AG, we will have immediate access to their knowledge and operational implementation skills. We will jointly demonstrate how perfect cooperation between retail and social commerce works. We are pleased to contribute our long-standing expertise in sales, purchasing, product development, marketing, and logistics to the new group."
This will also be reflected in the future management of Social Chain AG: Ralf Dümmel is appointed to the company’s executive board. As Chief Product Officer (CPO), he will be responsible for the product, purchasing, retail marketing, logistics, and sales divisions. The executive board of Social Chain AG will have three members hereafter. In addition to Ralf Dümmel (CPO), Social Chain AG will be run by Wanja S. Oberhof (CEO) and Christian Senitz (CFO).
"We are stepping up to shape the new world of brands and commerce."
Dr. Georg Kofler, Chairman of The Social Chain AG’s Supervisory Board and largest single shareholder, says: "For several years, I have had the pleasure of negotiating and concluding deals with startup companies alongside Ralf Dümmel as an investor on the German startup show "Die Höhle der Löwen", in front of an audience of millions. I am all the more pleased that, with Ralf Dümmel, we are winning an extraordinarily experienced and motivating entrepreneur to our board. From a strategic perspective, the perception of Social Chain AG as an innovative social commerce platform will become even clearer. We are stepping up to help shape the new world of brands and commerce. With products that people really want and that really make their lives better. Consumption has always been a social experience. Social media can enable us to develop, promote, and distribute brands and products more effectively. The significant expansion of our product range opens the door to new online shop concepts with comprehensive shopping carts. At the same time, the additional development and sourcing expertise of DS Group enables us to accelerate our products’ time to market. Moreover, our innovative multi-channel concept opens up ideal distribution channels – for mass-produced top runners and attractive niche products alike. Social Chain AG thus has the potential to become one of the leading social commerce platforms on an international scale."
About DS Group
DS Group, based just outside Hamburg, can now look back on more than 48 successful years. As an internationally operating retail company, DS Group currently has 550 employees and is forecast to generate a turnover of more than €270 million in 2021.
DS Group specializes on the production, import, and distribution of innovative products in the consumer goods sector. As one of Europe's largest developers and suppliers of non-food goods, the group supplies over 4,000 products to food retailers, discounters, drugstores, DIY shops, specialist retailers, cash & carry, self-service stores, mail order companies, home shopping, and online marketplaces. Thanks to the company's headquarters near Hamburg as well as three other German locations in the states of Mecklenburg-Western Pomerania, Schleswig-Holstein, and Hesse and eight international locations in China, Hong Kong, Vietnam, Great Britain, Hungary and Poland, DS Group covers the entire value chain around the world of products.
To date, Ralf Dümmel, managing partner of DS Group, has helped 213 founders place 330 products in the national and international retail market. Numerous bestsellers from the past seasons reflect the range of DS Produkte’s investments: From the innovative sink plug Abfluss-Fee to the baking concept Kinderleichte Becherküche, the gum care gel Parodont, the cutlery care Rokitta‘s Rostschreck, the bottle top Taste Hero, the cleaning pads waschies, the vehicle care wet wipes GENTLEMONKEYS, the miniature inhalator aspUraclip, the learning aid Schreibpilot, the silicone toilet brush LOOMAID, the hazelnut spread Haselherz, the anti-chafing stick SUMMERSAVER, and others, many successful products were able to establish themselves on the market in the long term. With its own brands, such as the oldest German barbecue manufacturer LANDMANN and numerous others, DS Group is also one of Europe's largest retail suppliers.
The Social Chain AG:
Social Commerce on a global scale
The Social Chain AG is reshaping the world of brands and commerce with social commerce. Our strategy and our actions are "Digital first – direct to customer": from branding to marketing to direct sales of our products in the categories Food, Home & Living, Beauty, and Fitness. Our online shops are the most efficient points of sale for our Direct-to-Consumer brands. More than 70 percent of D2C sales are performed by our owned and operated online shops. Our communities, with over 86 million followers worldwide, inspire our customers and amplify our brand messages. We manage the expansion of our Social Commerce system of communities, brands, digital points of sale, and logistics via our integrated proprietary technology platform: LINKS analyzes interests, purchase intentions, and product satisfaction along the entire digital customer journey. Social Chain AG has its headquarters in Berlin, with additional locations in Munich, London, Manchester, New York, and Los Angeles. The Social Chain AG has a total of around 850 employees. The shares of Social Chain AG (WKN: A1YC99) are being traded on XETRA and other German stock exchanges.