A wholly-owned subsidiary of 1847 Holdings, LLC signed an agreement to acquire ICU Eyewear Holdings, Inc., a designer of over-the-counter, non-prescription reading glasses, sunglasses, blue light-blocking eyewear, sun readers, and outdoor specialty sunglasses.
The acquisition will be funded without the issuance of common stock or dilutive equity and will be finalized during the first quarter of 2023, subject to customary closing conditions.
ICU was founded in 1956 and headquartered in Hollister, CA. The company has ten brands with “over 3,000 SKUs across the reading glass, sunglass, and health and personal care segments.” Its customer base comprises a broad range of national, regional and specialty retailers with over “7,500 retail locations.” ICU is distributed at all retail channels, including grocery, specialty, office supply, pharmacy, and outdoor sports stores.
According to Statista, the U.S. eyewear market was valued in 2022 at $29.38 billion and is forecasted to grow at a CAGR of 4.59 percent from 2021 to 2027, primarily due to the increase in vision impairments and the increased popularity of fashion eyewear among millennials. The OTC segment of the eyewear market, where ICU participates, focuses on non-prescription sunglasses and reading glasses and represents 12 percent or $5.2 billion of the total market.
Ellery W. Roberts, CEO of 1847, commented, “ICU is an excellent addition to our portfolio of growing and cash flow positive companies. ICU has developed a highly profitable and sustainable business model with solid financials, positive EBITDA and gross margin of approximately 40 percent. ICU’s line of distinctive eyewear has earned itself the title of No. 1 provider of OTC eyewear at Target, as well as its exclusive provider of personal care products. ICU plans to expand its products to new customers with a goal of being in 15,000 retail locations by 2025. Its 50,000-square-foot facility has the capacity to ship up to 15 million units per year across an array of product categories and room for additional staff and warehousing to support at least double the company’s current revenue.
“This transaction is another example of our successful acquisition strategy, targeting accretive and cash flow-positive companies. Our ability to acquire these businesses at attractive multiples, with minimum dilution to shareholders, has enabled us to offer shareholders a meaningful cash dividend. We look forward to working with ICU’s strong and talented team that has driven profitability and built an operational infrastructure to support significant growth,” concluded Roberts.
Total consideration for the acquisition is $4.5 million, subject to adjustment, consisting of $4,000,000 in cash and unsecured subordinated promissory notes in the principal amount of $500,000.
