Heaven Sent Naturals, Inc., Puri-Clean, Inc., and Covert Labs, Inc.

Tempe, Arizona

has been acquired by

Red Oak Capital

Addison, Texas

Capital Alliance Corporation initiated
this transaction and assisted in its closing.

Heaven Sent Naturals, Inc., Puri-Clean, Inc., and Covert Labs, Inc.

Heaven Sent Naturals, Inc., Puri-Clean, Inc., and Covert Labs, Inc., were three sister companies in the nutritional supplement industry. With the aid of Capital Alliance, these three businesses sold to Red Oak Capital, a Dallas-based private equity firm with a broad portfolio of companies.??

The Puri-Clean and Covert Labs cleansing products held the leading market position for supplements within the niche, while the Heaven Sent line offered a broad portfolio of nutritional products, including vitamins and supplements. The companies distributed their products to numerous independent and chain health food stores domestically.??The shareholders recognized the need for additional management expertise as they sought to scale the business upwards, while simultaneously reducing their investment risk. They enlisted the aid of Capital Alliance to secure a buyer.

Unique to this transaction was the shareholders’ desire to remain active in the business, and to spearhead the company’s growth as it upsized. Since the company functioned primarily as a sales and marketing organization, with limited tangible assets and a heavy reliance on outsourcing for product manufacturing, Capital Alliance accentuated the value of the company’s franchise and trademarks. Additionally, Capital Alliance emphasized the merit of the client’s extensive distribution network and profitable business model, and targeted an acquirer with a strong interest in obtaining a consumer industry business. Red Oak Capital had long been in discussions with Capital Alliance concerning potential acquisitions, gradually defining the characteristics of an ideally matched target company. Once engaged to represent Heaven Sent Naturals, Capital Alliance was able to streamline a mutually beneficial opportunity for both companies.

Capital Alliance negotiated terms specific to the shareholders wishes. The owners received proceeds of 66% in cash at closing and a 33% incentive payout over five years, while retaining 49% interest in the post-transaction entity.