Terminal X announced to the stock exchange that it has finalized binding agreements to purchase 51% of Strongful, a company specializing in sportswear. This follows the memorandum of understanding signed last month.
Strongful, founded in 2020, is managed by co-CEOs Dor Kedem and Yarden Deutsch. The company's apparel is sold exclusively online. According to Terminal X, Strongful is "one of Israel's leading activewear brands, with high growth and profitability rates."
The company's founders, who currently serve as co-CEOs, will retain a 49% stake in the new partnership and will continue in their roles for a minimum period defined in the agreement.
The valuation of Strongful was based on its 2023 audited net profit, considering zero net debt and normative working capital. Additionally, Strongful is eligible for future contingent consideration to be paid in the first half of 2025, as per the established mechanism.
Terminal X highlighted that the brand, established in 2020, "offers a wide range of high-quality activewear for women, with a broad size range, fair pricing, and rapid inventory turnover. It has quickly built a desirable brand and a loyal customer base, mainly among 18-40-year-olds." The company views this acquisition as a crucial step in executing its strategy to expand its fashion and lifestyle operations.
Moreover, Terminal X has the option to purchase an additional 24% of Strongful's shares during 2027 or 2028, based on the company's annual net profit multiplier for 2026 or 2027.
This is not the first time Terminal X has acquired a young Israeli brand. In 2022, it acquired the women's fashion brand Sisters, founded by sisters Alona and Daniela Zur.
Nir Horowitz, CEO of Terminal X, stated, "We are proud to announce the signing of binding agreements with Strongful. As part of Terminal X's growth strategy, we are exploring acquisitions of e-commerce companies with high growth and profitability metrics. We recognize Strongful's significant potential in Israel and worldwide and believe that, together with the talented founders and Terminal X's e-commerce infrastructure, we can realize this potential."