Tooru plc (LSE:TOO) has terminated plans to acquire Dutch health and wellness company Mylky B.V. after concluding that the proposed transaction would expose the group to an unacceptable level of financial and operational risk under current market conditions.
The board determined that completing the acquisition would require a significant increase in debt financing at a time of heightened geopolitical uncertainty and challenging capital market conditions. Management also ruled out raising equity to fund the deal, citing concerns that such an approach would be excessively dilutive to existing shareholders given Tooru’s current market valuation and the relative size of the proposed acquisition.
In addition to financing considerations, further due diligence identified regulatory risks associated with expanding into a European legislative environment where the company has less experience. Tooru noted that its expertise is largely concentrated within the UK regulatory framework, and the acquisition would have substantially increased its exposure to compliance requirements across multiple European jurisdictions.
Following the decision to abandon the transaction, the company said it will concentrate on developing its existing operations, which it believes offer more attractive and lower-risk growth opportunities in the near term. Management also confirmed that it remains open to pursuing future acquisitions, although any potential targets are expected to be smaller in scale, strategically aligned with the group’s existing activities and capable of being completed without materially increasing leverage.
The decision reflects a cautious approach to capital allocation as the company seeks to balance growth ambitions with financial discipline and risk management in an uncertain economic environment.
More about Tooru plc
Tooru plc is an AIM-listed health and wellness company focused primarily on consumer-facing brands in the UK market. The group operates within the branded health and wellness sector and seeks to grow through a combination of organic development and carefully selected acquisitions.
The company’s strategy emphasises sustainable expansion, disciplined capital management and opportunities that complement its existing expertise, with a particular focus on businesses operating within regulatory environments it understands well.
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