Life-Space Group, which was privately owned, is one of the largest probiotic companies in Australia. It operates the Evolution Health and Ultramix businesses, and owns Life-Space, the market-leading probiotic brand sold in China and Australia.
In addition, the company owns or distributes Healthy Essentials, Elmore Oil and Corams — a brand portfolio in the natural health, joint and muscular pain relief, and infant care categories.
The A$690m transaction is subject to customary shareholder and regulatory approvals.
Life-Space Group first entered the Chinese market through cross-border e-commerce in 2014 and has since seen sales soar. It is also the market-leading probiotic brand in Chemist Warehouse, Australia's largest pharmacy retailer.
In November, we revealed that the firm recorded its highest ever China Singles' Day sales, cementing its position as the bestselling probiotic brand on the Tmall platform with more than 78,000 units sold — more than three times the brand's record sales in 2016.
Group managing director of Life-Space Group Ben McHarg, who was a keynote speaker at our Probiota Asia summit last year, said: "Life-Space Group has grown exponentially over the past five years, and we've reached a point where, to continue our expansion both domestically and internationally, we needed to review the privately-owned structure of our business."
Management team retained
"It is especially pleasing to note that BY-HEALTH has provided an ongoing commitment to our staff and management team, headquartered in Melbourne, who have been instrumental in achieving the growth and success we have experienced, both in Australia and abroad."
Formed in 1995 and listed on the Shenzhen stock exchange, BY-HEALTH is China's biggest domestic supplement brand, and already has the rights to permanently operate the Nature's Bounty and Met-RX businesses in the country.
It said the acquisition of Life-Space Group represents a natural progression towards the company becoming a globally recognised brand owner.
BY-HEALTH CEO Zhicheng Lin said: "The acquisition will help Life-Space Group integrate its products and brand in the probiotic market segment and online channels, providing strong support for BY-HEALTH to develop new product categories and channels.
"Life-Space Group may also be able to take advantage of BY-HEALTH's marketing network and channels to improve its own access in China and continue its strong growth momentum."
This is the latest high-profile acquisition of an Australian brand by a Chinese company.
In 2015 / 2016, Biostime (now known as Health & Happiness) bought Swisse, while Vitaco was snapped up by Shanghai Pharmaceutical Co a year later.
Meanwhile, Australia's third-largest vitamin firm Nature's Care is tipped to be taken over this year, with Chinese investors thought to be in pole position.