12 ReTech Corporation has acquired E-motion Apparel, Inc. in a stock-for-stock transaction between 12 ReTech and Hubert (Hub) Blanchette, the owner and CEO of the company. E-motion Apparel owns several brands, including E-motion Apparel, Lexi-Luu Dancewear, Punkz Gear and Skipjack. E-motion Apparel management will be retained and assist 12 ReTech with the growth of its e-commerce channels going forward.
Angelo Ponzetta, 12 ReTech’s CEO stated, “We are pleased to have E-motion Apparel as the first acquisition of our consumer product microbrand rollup strategy. Their USA-based manufacturing capabilities will enhance our ability to quickly produce new samples and product ideas, which is critical to the successful execution of our e-commerce strategy for apparel. Hub Blanchette has many years of experience in running an apparel-based e-commerce business through proprietary websites as well as through internet consumer goods gateways like Zulily and Amazon.”
Blanchette commented, “I am impressed by the software technology of 12 ReTech, which helps retailers to fight and thrive in the very tough environment we are experiencing today. I feel that their technology will determine the future winners in the retail industry. Joining 12 ReTech is very exciting to me. I expect our brands to benefit greatly under 12 ReTech’s ownership, as I will now have access to the working capital that I have been looking for to get our business to the next level of success. Once we receive the working capital, I am projecting $1.4 million in revenues, with $300 thousand EBITDA over the next 12 months. There are opportunities that I see where we could double these projections in the second 12 months!”
Angelo Ponzetta added, “Hub Blanchette’s brands are not well known throughout the world yet, but they have a large potential to grow. What I especially like about E-motion Apparel is that the company has their own manufacturing capabilities in the USA which are tailored for smaller production runs. This will allow us to keep our online offerings new and fresh and should reduce our lead-time to test new products before committing the resources to produce large production runs overseas. This strategic asset will be very useful for our next moves. I see E-motion Apparel as the foundation stone of our microbrand acquisition strategy in the USA in support of our technology efforts worldwide.”
Ponzetta concluded, “As I explained in my recently published shareholders update letter, we are working on many microbrands that fit our rollup acquisition model. It happens that this one, which hadn’t been announced, came together very quickly, while some of our previously announced acquisitions are taking a little longer because they need third-party approvals such as from their banks. Notwithstanding, we still expect to acquire all of the acquisitions already announced.”