Wellnex Life (ASX/AIM:WNX) has signed a binding agreement to sell its "Pain Away" brand and associated assets to Mentholatum Australasia Pty for up to A$21.3 million in cash.
The dual-listed consumer healthcare and contract manufacturing group will receive A$19.8 million upfront at completion, with a further A$1.5 million earn-out tied to the brand's normalised EBITDA performance over the following 12 months.
Mentholatum sits within the global consumer healthcare group ultimately owned by Rohto Pharmaceutical Co, a Tokyo Stock Exchange-listed Japanese pharmaceutical and FMCG company.
Pain Away generated approximately A$4.36 million in EBITDA and A$13.38 million in revenue in the year to 30 June 2025, with gross assets of A$22.76 million as at 31 December 2025.
Wellnex plans to use the proceeds to fully repay approximately A$10.2 million in secured and unsecured borrowings, including loans to former directors now extended to completion, leaving the company debt-free.
Remaining funds will support working capital, growth initiatives in its retained retail and distribution operations, and potentially a return of capital to shareholders.
"This transaction represents an important step for Wellnex Life, strengthening the company's balance sheet and providing greater financial flexibility," said Interim Executive Chairman Eric Jiang.
The deal follows unsolicited approaches received in February regarding Pain Away, after which the board concluded a cash sale was the most appropriate route for shareholders.
An extraordinary general meeting to seek shareholder approval under AIM Rule 15 is set for Tuesday 8 September, with completion targeted shortly after approval is obtained.
News Intelligence what this means for the company
Wellnex Life has agreed to sell its Pain Away brand to Mentholatum Australasia for up to A$21.3 million, with A$19.8 million upfront and a A$1.5 million earn-out. The company will use proceeds to eliminate approximately A$10.2 million in debt, leaving it debt-free and with capital available for working capital, growth in retained operations, and potential shareholder returns. This addresses a balance-sheet constraint that has limited strategic flexibility.
The sale removes a material debt burden (A$10.2 million against a A$19.8 million upfront receipt) and shifts Wellnex from a diversified consumer healthcare and contract manufacturing group toward a pure-play retail and distribution operator. Whether this refocusing creates value depends on the retained business's profitability and growth prospects—neither disclosed here—and on whether Pain Away's A$4.36 million EBITDA contribution (roughly 19% of the A$22.76 million in gross assets sold) was a drag or anchor for the group.
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