Spin Master Corp · TSX:TOY
Spin Master — Merger or Acquisition (January 2024)
19 slides from Spin Master's merger presentation, Jan 2, 2024
Slide 1: Reimagining Everyday Play: Acquisition of Melissa & Doug
REIMAGINING EVERYDAY PLAY ACQUISITION OF MELISSA & DOUG October 11, 2023
Slide 2: Today's Speakers
TODAY’S SPEAKERS Max Rangel Global President & Chief Executive Officer Mark Segal EVP & Chief Financial Officer 2 2023-10-10 Confidential & Proprietary
Slide 3: Disclaimer
Disclaimer Forward-Looking Information Certain statements, other than statements of historical fact, contained in this presentation, may constitute "forward-looking information" within the meaning of certain securities laws, including the Securities Act (Ontario), and are based on expectations, esti
Slide 4: Agenda
AGENDA • Introduction • Melissa & Doug Overview • Acquisition Rationale • Transaction Details • Q&A 4 2023-10-10 Confidential & Proprietary
Slide 5: Timeless open-ended play with endless learning possibilities
Timeless open-ended play with endless learning possibilities to join Spin Master
Slide 6: Compelling Strategic & Financial Rationale
Compelling Strategic & Financial Rationale Trusted brand of open-ended, creative, and developmental toys Compelling Highly relevant for modern parents seeking sustainable wooden toys and screen-free play Strategic Logic Brings complementary capabilities and expands our presence in early childhood to
Slide 7: Reimagining Everyday Play
Reimagining Everyday Play Toys Leading Global Creating Magical Children’s Play Experiences Entertainment Entertainment For Kids & Families Company Digital Games 7 2023-10-10 Confidential & Proprietary
Slide 8: Proven Track Record Of Organic And Acquisition Growth
Proven Track Record Of Organic And Acquisition Growth History of creating, innovating and monetizing intellectual property across our three creative centres, while remaining highly disciplined in seeking and integrating accretive acquisitions and becoming trusted stewards of highly-recognized brands
Slide 9: We Know Preschool
We Know Preschool Today, Spin Master captures young imaginations with its outstanding lineup of Preschool toys: the entry-point to the Toy market
Slide 10: Play Powered By A Child's Imagination
“The best play, discovery, and creation simply begins with imagination.” Melissa Ber nst ein, Co-Founder of Melissa & Doug Play Powered By A Modern parents care deeply about their child's developmental potential. Open-ended play is a powerful Child’s Imagination teacher, helping to build early real-
Slide 11: Leading Brand With High Consumer Relevance
Leading Brand With High Consumer Relevance Highly Rated Highly recommended by parents for quality, with strong sustainability & consumer loyalty developmental play* Sustained POS Industry-leading performance ahead ecommerce of the market over the past 5 years performance *Source: General Population
Slide 12: At-a-Glance: A Leading Brand in Open-Ended, Pretend Play
at-a-Glance From classic wooden toys to realistic pretend play sets, Melissa & Doug products inspire creative thinking through hands-on, open-ended play Pretend Play Developmental Toys Arts & Crafts Puzzles Active Play & Outdoor (~42% of sales1) (~20% of sales1) (~18% of sales1) (~7% of sales1) (~2%
Slide 13: Building The Future Of Early Childhood Play
Building The Future Of Early Childhood Play Focus In Key Preschool Broad Presence Across Segments Early Childhood Segments ”SHOW TO SHELF” ”LEARNING THROUGH PLAY” • Inspired by Entertainment • Open-ended & Imaginative • Begins at 2 • Begins at Infant • Child Relationship • Parent Relationship • High
Slide 14: Capabilities To Innovate And Unlock Incremental Growth
Spin Master Has The Capabilities To Innovate And Unlock Incremental Growth Incremental Growth Potential Grow Expand Innovate Adjacency Whitespace Core Distribution The Core Expansion Opportunities Low-churn Grow mass and Brand marketing, Baby & toddler Expansion into evergreen e-comm channels, innov
Slide 15: Transaction Summary
Transaction Summary Spin Master to acquire Melissa & Doug for $950 million cash Transaction Additional earnout consideration of up to $150 million, contingent on achieving certain financial targets post Overview close1 v $950 million purchase price6 represents 10.5x 2022 Adjusted EBITDA3, and
Slide 16: Transaction Financing Structure
Transaction Financing Structure • Transaction purchase price of $950 million1 plus additional contingent earnout consideration of up to $150 million, subject to achieving certain financial targets post close4 o Purchase price funded with $450 million of cash and debt financing of $500 million o Asse
Slide 17: Compelling Strategic & Financial Rationale
Compelling Strategic & Financial Rationale Trusted brand of open-ended, creative, and developmental toys Compelling Highly relevant for modern parents seeking sustainable wooden toys and screen-free play Strategic Logic Brings complementary capabilities and expands our presence in early childhood to
Slide 18: Q&A
REIMAGINING EVERYDAY PLAY ACQUISITION OF MELISSA & DOUG Q&A October 10, 2023
Slide 19: Non-GAAP Financial Measures and Ratios
Non-GAAP Financial Measures and Ratios In addition to using financial measures prescribed under International Financial Reporting Standards ("IFRS"), references are made in this Press Release to the following terms, each of which is a non-GAAP financial measure: v • Adjusted EBITDA • Adjusted EBITDA