Rheal has hired M&A advisors to explore a sale of the rapidly growing superfoods brand as it looks to expand the business further into the grocery channel and international markets.
The business is working with independent corporate finance firm Spayne Lindsay – which last week advised Delciously Ella on a sale to Hero Group – to explore all options, The Grocer has learned.
A process is expected to get going in early 2025, with City sources expecting interest from big trade players and private equity investors.
“Rheal has really tapped into a big area of customer demand in the health space, with its clean label products continuing to just grow and grow,” said one City source.
“There should be plenty of interest from potential buyers next year that can really help the brand get to the next level as there are a number of growth levels they can get behind, especially in grocery and overseas.”
Charlotte Bailey and husband Sean Ali co-founded the business in 2017 after they turned to natural ‘superfoods’ to help with health issues.
Sales of Rheal’s range of supplements and caffeinated energy bars took off after the pair appeared on the BBC’s Dragons’ Den in 2021, securing an offer for £50k from all five dragons.
Ultimately, turning down the investment, Rheal instead launched a crowdfunding campaign on Seedrs, raising almost £1m from more than 400 backers and securing a valuation of £6m.
Tej Lalvani, CEO of Vitabiotics and one of the dragons to make an offer on the show, also invested independently to take a small stake in the B-Corp business.
Revenues rocketed following the injection of capital as the Gateshead-based company funded a marketing campaign to continue to grow consumer awareness.
A two-year compound annual sales growth (CAGR) of 235% secured Rheal a place as the second fastest growing brand in fmcg this year, behind Trip in Alantra’s most recent Fast 50.
The top line reached £20m in 2023, after growing threefold, and is expected to break through £30m this year.
Most of the turnover has been generated online so far, but the brand is making progress in retail thanks to a nationwide listing with Holland & Barrett. It also agreed a distribution deal with Tesco and is planning to expand its footprint into other retailers, as well as overseas.
Rheal featured in the Forbes 30 Under 30 list in 2022 and was ranked third in this year’s Sunday Times 100, with annual sales growth over three years of 243%.
It was also shortlisted for SME Brand of the Year and Health & Beauty Brand of the Year at the 2024 Grocer Gold Awards.
Any deal struck next year is expected by City sources to provide an exit for Lalvani and the crowd investors, with the two founders also likely to sell a stake while keeping hold of a minority share of the business.
Rheal and Spayne Lindsay declined to comment.
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