Baker: Me Today the next Trilogy
Health retail start-up building brand in NZ for global push
Grant Baker thinks NZX debutant Me Today has the potential to be the next Trilogy. Baker, who with business partner Stephen Sinclair and former Trilogy general manager Michael Kerr owns 60 per cent of the company, has high hopes for the tiny start-up.
Skincare company Trilogy — formerly Ecoya, which was listed by Baker, Sinclair and Geoff Ross in 2010 — went from next to nothing to $120 million in turnover in seven years.
“The intention is to do better than that,” Baker, who chairs the new company, told the Herald. “There is opportunity to be a lot bigger.”
In 2018, Trilogy was sold to Citic Capital China Partners for $203m or $2.90 a share — a 28 per cent premium to its market price.
Brendan Lindsay, of Sistema fame, has a 12 per cent stake in Me Today, but Baker says Lindsay’s involvement is incidental — the two have never met.
Me Today is the result of a reverse takeover by CSM — which was listed on the now-defunct junior board, the NZAX, before moving to the exchange’s main board last July.
Backdoor listings such as the one employed by Me Today are sought because they don’t require a prospectus and are cheaper than a standard listing on the NZX.
In its last annual report for the year to June, CSM — a former scrap metal company — announced a $1.3m loss.
The CSM transaction is the first to be undertaken since the NZX introduced new rules covering reverse listings in January last year.
CSM was a cashed up listed shell with no actual business until Me
Today was approached. The company’s Hong Kong owners wanted to do something with it and Baker and his partners took up the opportunity.
CSM started trading as Me Today in late March, amid the market chaos arising from the Covid-19 pandemic.
Since then the shares have traded as high as 11.5 cents and as low as 8.5c.
“Funnily enough, the timing was bad for lots of reasons but the Covid19 thing has got people focused on their health and wellness, so potentially it is a good time to be in that business,” Baker said.
He says the new retail skincare and vitamins business — like Trilogy — uses products based on natural ingredients. Its vitamin capsules are made from vegetable product.
After signing a deal last November with Green Cross Health, whose pharmacies include the Life Pharmacy chain, Me Today now sells in 220 stores. The company is still in its infancy but Baker said the plan was to first establish the brand in New Zealand and then take it international.
“New Zealand is a good place to build the brand and there is a lot of credibility in brands that come from here,” he said.
The company has ambitions for China, using the e-commerce contacts made in Baker’s days with Trilogy, and then the United States.
Baker is also chairman of Turners Auctions — which listed via the ailing finance company Dorchester Pacific. Turners now employs 1000 people and has turnover of $330m.
He concedes that back door listings have a certain stigma attached, usually arising from lower disclosure requirements associated with them, but he said listing via CSM was a matter of convenience.
“It allowed us access to a listing for not much money.”
Me Today was folded into CSM with a million dollars in cash “just to say that we are pretty focused and committed to this thing”.
The business is now sitting on about $4m in cash.
Baker said the vitamins sector tended to be commoditised, and people tended not to buy brands.
“Not a lot of people are willing to set themselves apart . . . so we are going quite hard on the branding side of things,” he said.
Hannah Barrett, whose husband Beauden plays for the All Blacks, has been appointed to the board and Baker said she would bring social media marketing skills to the enterprise.
Barrett has a commerce degree and a background with PwC.
“She is quite big in the social media space with about 60,000-70,000 followers, with knowledge about that kind of marketing,” he said.
Also on the board is Antony Vreins, a medical doctor.
Baker, who has been involved with several listed companies including 42 Below, Salvus Strategic Investments and Moa Group, said he had become more conscious about health issues since surviving cancer 15 years ago.