Nichols (AIM:NICL) has acquired 100% of VITHIT and its subsidiaries for €75.0 million, or approximately £64 million, on a debt-free, cash-free basis.
The diversified soft drinks group, best known for Vimto, said the deal is expected to be immediately earnings enhancing, before one-off transaction costs of roughly £2.5 million.
VITHIT is a vitamin-fortified functional drinks brand with leading market positions in the UK and Ireland, generating €26.5 million in revenue and €4.2 million in adjusted operating profit for the year to 31 December 2025, a 15.8% margin.
Sales have grown more than 90% since 2021, with a three-year compound annual growth rate of approximately 9.5%.
Nichols expects the asset-light business to generate synergies of over €1 million annually and plans to accelerate growth by using its distribution network, customer relationships and international operating model.
The deal is funded from Nichols' own cash balance, leaving the group net cash positive as at 30 June, with a new NatWest revolving credit facility to support working capital.
Founder and Chairman Gary Lavin will step down from day one, though other members of VITHIT's management team will support a transition period.
"VITHIT perfectly fits the acquisition profile we have been looking for and is fully aligned with our long-term growth strategy," said chief executive Andrew Milne.
Nichols reaffirmed its dividend cover policy of 1.5x and said the acquisition will enhance earnings per share and dividends per share from the 2027 financial year onwards.
News Intelligence what this means for the company
Nichols has acquired VITHIT, a vitamin-fortified functional drinks brand generating €26.5 million in revenue at a 15.8% operating margin, for €75 million (£64 million) in cash. The deal is immediately earnings-accretive before transaction costs, funded from Nichols' own balance sheet while maintaining net cash, and taps into the UK functional drinks market estimated at £5.8 billion with projected growth of +10% in the 2025–2026 period—a strategic fit with Nichols' diversified portfolio and distribution reach.
The acquisition adds a high-margin, fast-growing brand (90% sales growth since 2021, 9.5% CAGR over three years) to Nichols' portfolio and is expected to enhance earnings per share and dividends per share from 2027 onwards, supporting the company's 1.5x dividend cover policy. Synergies of over €1 million annually and leverage of Nichols' distribution network position VITHIT for acceleration, though realisation of those synergies and the 2027 earnings uplift remain execution risks.
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